Because they're complaining about people making money when those same people are making the complainers more money.
Because they're complaining about people making money when those same people are making the complainers more money.
Originally posted by: frostedflakes
Risk of prison time? Here's an idea, don't do anything illegal or unethical and there's nothing to worry about.Originally posted by: krunchykrome
sure, thats one reason why we're paying them more
The risk of prision time....a risk that was not in the job description 30 years ago. Consider the increase in executive compensation to be hazard pay.
put the baseball mitt down, my point went right over your head
krunchykrome,
I don't think a lot of these poster understand SOX. Your point is understood, substantial personal penalties exist now that didn't before. That's more risk, more work, more wide sweeping decisions, more accountability, more leadership, more checks/balances. Basically the job of CEO today is much, much, much more difficult and the consequences of their decisions carry much more weight with personal impact than it used to be.
Why people don't understand that the impact of your decisions is directly related to your compensation is beyond me.
I don't think a lot of these poster understand SOX. Your point is understood, substantial personal penalties exist now that didn't before. That's more risk, more work, more wide sweeping decisions, more accountability, more leadership, more checks/balances. Basically the job of CEO today is much, much, much more difficult and the consequences of their decisions carry much more weight with personal impact than it used to be.
Why people don't understand that the impact of your decisions is directly related to your compensation is beyond me.
frostedflakes
Diamond Member
- Mar 1, 2005
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I understand the point you're trying to make that executives are more liable today and could potentially get in trouble for honest mistakes by themselves or their employees. You then choose two horrible examples to back up your point. Enron and Tyco executives knowingly broke the law. These guys are criminals, not victims.Originally posted by: krunchykrome
Originally posted by: frostedflakes
Risk of prison time? Here's an idea, don't do anything illegal or unethical and there's nothing to worry about.Originally posted by: krunchykrome
sure, thats one reason why we're paying them more
The risk of prision time....a risk that was not in the job description 30 years ago. Consider the increase in executive compensation to be hazard pay.
put the baseball mitt down, my point went right over your head
If you want to convince me of your point, link me to a stories about execs who got in trouble for an honest mistake or lack of knowledge about what was going on in their company. I doubt you'll find much.
Originally posted by: frostedflakes
I understand the point you're trying to make that executives are more liable today and could potentially get in trouble for honest mistakes by themselves or their employees. You then choose two horrible examples to back up your point. Enron and Tyco executives knowingly broke the law. These guys are criminals, not victims.Originally posted by: krunchykrome
Originally posted by: frostedflakes
Risk of prison time? Here's an idea, don't do anything illegal or unethical and there's nothing to worry about.Originally posted by: krunchykrome
sure, thats one reason why we're paying them more
The risk of prision time....a risk that was not in the job description 30 years ago. Consider the increase in executive compensation to be hazard pay.
put the baseball mitt down, my point went right over your head
If you want to convince me of your point, link me to a stories about execs who got in trouble for an honest mistake or lack of knowledge about what was going on in their company. I doubt you'll find much.
This was the point I was trying to make. The Enron exec's knew they were breaking the law all along. It wasn't like something was going on in the company that they weren't aware of, or that they were caught off guard by some obscure regulation they weren't aware of.
Honestly, how does anyone even find the motivation to go to work and do a good job knowing that the CEO of your company is likely making 500X your pay, and that that multiple will likely only increase with time? How does anyone feel motivated knowing that they are essentially worthless to the company when compared to the CEO, and will only become more worthless in relative terms as time goes on?
Don't tell me it's because you hope to become CEO someday, because the odds of that happening for anyone are extremely remote.
Wow, the point went right over your head again. You didn't even raise the mitt, it just zinged by you. I'm not trying to be insulting, but have you ever been in business or understand it?
There's a big difference between signing your name and signing your name with the business name under it contractually speaking, this is why you always put company name below your signature when acting on company behalf and not personal.
With SOX CEOs are personally responsible for their decisions and due diligence of the company even if they are acting on behalf of the company. Personally, not just company money.
Krunchy's point was these kinds of risks and extras work, extra skill, extra experience were not necessary before SOX.
Ns1
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Originally posted by: Special K
Originally posted by: frostedflakes
I understand the point you're trying to make that executives are more liable today and could potentially get in trouble for honest mistakes by themselves or their employees. You then choose two horrible examples to back up your point. Enron and Tyco executives knowingly broke the law. These guys are criminals, not victims.Originally posted by: krunchykrome
Originally posted by: frostedflakes
Risk of prison time? Here's an idea, don't do anything illegal or unethical and there's nothing to worry about.Originally posted by: krunchykrome
sure, thats one reason why we're paying them more
The risk of prision time....a risk that was not in the job description 30 years ago. Consider the increase in executive compensation to be hazard pay.
put the baseball mitt down, my point went right over your head
If you want to convince me of your point, link me to a stories about execs who got in trouble for an honest mistake or lack of knowledge about what was going on in their company. I doubt you'll find much.
This was the point I was trying to make. The Enron exec's knew they were breaking the law all along. It wasn't like something was going on in the company that they weren't aware of, or that they were caught off guard by some obscure regulation they weren't aware of.
Honestly, how does anyone even find the motivation to go to work and do a good job knowing that the CEO of your company is likely making 500X your pay, and that that multiple will likely only increase with time? How does anyone feel motivated knowing that they are essentially worthless to the company when compared to the CEO, and will only become more worthless in relative terms as time goes on?
Don't tell me it's because you hope to become CEO someday, because the odds of that happening for anyone are extremely remote.
That's fucking weak. He fucking EARNED that shit. If you can't earn that shit then you don't deserve it. It's not like one morning the board is like "hey, let's appoint joe schmoe to be our CEO"
He fucking paid his dues to get where he is.
It's because I hope to become a CEO someday, that's what motivates me. Sorry, it's the money that motivates me. I'm not kidding. I'm motivated by the money. Odds of it happening to me? Extremely remote, pretty much impossible, closer to impossible. But that's not going to stop me from trying.
Seen others I associate with achieve it? Yep. And they were worth every penny, they really were that good.
frostedflakes
Diamond Member
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What extra skill? The ability to make ethical decisions? I see what you're saying about them being personally liable, I just don't understand why it matters. If they knowingly break the law, they deserve to be taken to court. We shouldn't pay them more because it's expected that they might break the law at some point in their career.
frostedflakes
Diamond Member
- Mar 1, 2005
- 7,925
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I'm not saying CEOs who earn their company lots of money don't deserve their compensation - they do. I just don't understand how anyone can find any value or meaning in their own jobs knowing that they are basically worthless to the company when compared to the CEO, and will likely become more worthless in relative terms as time goes on (assuming the trend in CEO pay continues). You've even said yourself in previous posts that everyone (except perhaps the CEO) is expendable.
It's a rhetorical question I guess.
For sure, If somebodies performance is recognized and they are paid for it, it will be a good motivation.
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I suggest you read the annual reports of various companies, specifically your own. Everybody is expendable, even the CEO. The cost of replacing them is high (cost of finding a suitable replacement, instability, lack of leadership, etc), but they're not irreplaceable.
Not to be blunt, but finding value or meaning in ones job is an internal/personal thing and self defeating if you want to move up. It's all one big game man, one big game.
So the question becomes why is that worth so much more in this country compared to our European and Asian counterparts?
Edit- here is a website with some facts and figures for people to consider.
http://www.pbs.org/now/shows/311/executive-pay.html
To those wondering why I care, it's not out of jealousy. It just doesn't make sense, and it's hard not to think about it when almost every company in the US pays their top exec's like this. I've been with my company a while now, so I've had the chance to work with some of the top guys before they got to the top, and some are not that competent, and aren't doing anything more productive than they were when they were making 100K. It's okay to pay someone a ton if they're worth it, because I do agree most people are not that competent, but the compensation is out hand, and also the other perks. A lot of the time these guys do nothing, drive a company into the ground, and then get huge severance. I've seen that happen...
Example, this dude was VP, and making nearly 200K. He ran the software division for almost three years. Pretty much every project that went on while he was running the show was a huge failure. A website redesign that took 2 years to complete... and ended up launching with less features and functionality than the old site. A glorified facelift. He was so horrible that all the good people left (including me, but i still know people there), and he's finally leaving, I'm sure with a good severance. And the worst part is, he's "part of the club" now, so he'll probably manage to get a position as a CIO now, or something else even higher paying than what he's at now.
Something more incentive based is different.
As for sports figures and celebrities, they can ask that much because they really are a limited commodity in high demand. You can't fill the Laker stadium without players as talented as Kobe, Shaq, Lebron, etc, so those players deserve as much as they can get out of it i guess.
Example, this dude was VP, and making nearly 200K. He ran the software division for almost three years. Pretty much every project that went on while he was running the show was a huge failure. A website redesign that took 2 years to complete... and ended up launching with less features and functionality than the old site. A glorified facelift. He was so horrible that all the good people left (including me, but i still know people there), and he's finally leaving, I'm sure with a good severance. And the worst part is, he's "part of the club" now, so he'll probably manage to get a position as a CIO now, or something else even higher paying than what he's at now.
Something more incentive based is different.
As for sports figures and celebrities, they can ask that much because they really are a limited commodity in high demand. You can't fill the Laker stadium without players as talented as Kobe, Shaq, Lebron, etc, so those players deserve as much as they can get out of it i guess.
Good post. My father is going through this very thing. The now VP of the division ran 2 different plant locations into the ground. Both were making money before he showed up. So how did they reward this guy? They promoted him to corporate.
How would that not be ironic?
An individual detests companies that provide executives with excessive compensation ... that same individual supplies the same companies with additional capital (through equity) to pay said executives more compensation (especially considering the individual believes the company is "corrupt" and tends to "waste" capital in this way).
Or, to look at it another way, the hypothetical idiot demands government or other members of the public act to decrease executive compensation ... yet this same individual has equity in these same companies and does not exercise his own ability to influence the board.
Events that contradict normal expectations ... the definition of situational irony.
The problem is the "average" shareholder has little or no say in how much the executives are paid.
At least then they are voting with their $$$. If all these people that dislike excess compensation so much were to exercise what little influence they do have and still fail at making a difference, then it's obvious that collectively they are still a distinct minority.
Those that are in a position to make these decisions understand the rather rudimentary economic principles driving executive compensation, and they find the status quo to be working quite well. A vocal minority isn't going to make a difference by throwing around superlative anecdotal evidence of where this system fails.
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