Sky-high CEO pay is tied to what peers get, not how company does

[Phokus]

Bull shit. prove overwhelming majority of publicly traded companies are like this.

Since then, researchers have found that about 90 percent of major U.S. companies expressly set their executive pay targets at or above the median of their peer group. This creates just the kinds of circumstances that drive pay upward.

Stop talking about shit you have no idea about you peon.

 

[Phokus]

Rchiu, you are batshit fucking retarded:

These kinds of ties — between chief executives and the boards that oversee them — permeate corporate America. On a typical board, the chief executive considers about about 33 percent of the board of directors as “friends” rather than as mere “acquaintances,”according to a survey of chief executives at about 350 S&P 1500 corporations conducted over 15 years by University of Michigan business professor James Westphal.

More tellingly, the chief executive is likely to find even more friends on the compensation committees of corporate boards — almost 50 percent.

 

[bfdd]

LMAO, then what do you propose? Having a hands off approach didn't work.

I remember reading that countries with regulations that required non-binding shareholder votes on exec compensation had less pay disparity between CEO's and the average workers.

Also, i would imagine Germany (aka, the country with 6% unemployment) that has a law that requires employee/union representation on the board (50% at mid/large companies, 33% at small companies) probably has far saner CEO compensation than we do.

Kill them? I mean you could always go that route. They're pretty evil bastards apparently so I doubt it would be frowned upon to much right? First solution is like was offered, stop doing business with that fucking company. Stop completely. Make it known that you refuse to do business with them and anyone else who does business with them. Vote with your wallet and your voice. If that doesn't work, well yeah I'd go with what I offered up first then because that's probably about the only thing that will get the point across then.

Also, anyone who doesn't believe that higher levels of business aren't like this must have forgotten when they were in school.

 

[rchiu]

And what, you're a somebody? You've done the research? We should listen to YOU? Takes 'one company' my ass. Read the article you moron.

No I haven't done research and I am nobody. That's why I don't tell companies what the hell they should be doing, unlike other know-it-all people in this forum.

You should read your of f'ing article. They talk about one company that increased pay while company performance languished, they used this one example to show how peer benchmarking is not right.

Peer benchmarking is not right? Have you negotiated your salary before? Have you take salary.com's average salary info as the basis for your salary negotiation? You are using freaking peer benchmarking. That's what every job seekers do.

 

[Phokus]

Kill them? I mean you could always go that route. They're pretty evil bastards apparently so I doubt it would be frowned upon to much right? First solution is like was offered, stop doing business with that fucking company. Stop completely. Make it known that you refuse to do business with them and anyone else who does business with them. Vote with your wallet and your voice. If that doesn't work, well yeah I'd go with what I offered up first then because that's probably about the only thing that will get the point across then.

You HAVE no choice. This isn't one or two companies that are doing this, this is a disease that's spread from one board room to another (INTERLOCKING FUCKING DIRECTORATES). What are you going to suggest to me next, 'don't buy anything that's made in China'?

 

[Phokus]

No I haven't done research and I am nobody. That's why I don't tell companies what the hell they should be doing, unlike other know-it-all people in this forum.

You should read your of f'ing article. They talk about one company that increased pay while company performance languished, they used this one example to show how peer benchmarking is not right.

Peer benchmarking is not right? Have you negotiated your salary before? Have you take salary.com's average salary info as the basis for your salary negotiation? You are using freaking peer benchmarking. That's what every job seekers do.

Read the article again, you idiot. There 'peers' have nothing to do with one another in terms of industry and size. It's like a janitor comparing his salary to a programmer and asking his pay to be in the 75% percentile of the average computer scientist.

Also P.S. i work in corporate finance, and between me and my wife, we bring home a decent 6 figure salary. LK works near me in investment banking (or related financial industry) and makes multiple times that my family does (IIRC). We're not fucking hippies sitting around a drum circle complaining about 'the man' while smoking reefer, you idiot.

 

[rchiu]

Rchiu, you are batshit fucking retarded:

So what if CEO is friend to 33 percent of the board of directors? Other 66 percent are still the majority and can oversee the conflict of interest. Do you actually expect the board to hire a total stranger to the top job? If you have a day in real business world, you'd probably know networking is everything, and just because you are friend/part of the network, it doesn't mean some criminal thing is happening.

Again, you have nothing to prove CEO pay increase is due to conflict of interest and not market demand and supply. Even your original article doesn't prove that other than the CEO sucks and he doesn't deserve his pay.

That happens, not just to CEO but jobs at every level. It's just that you, Obama and liberal are trying to start this class warfare and CEO and other rich people are your prime target.

 

[Phokus]

So what if CEO is friend to 33 percent of the board of directors? Other 66 percent are still the majority and can oversee the conflict of interest. Do you actually expect the board to hire a total stranger to the top job? If you have a day in real business world, you'd probably know networking is everything, and just because you are friend/part of the network, it doesn't mean some criminal thing is happening.

Again, you have nothing to prove CEO pay increase is due to conflict of interest and not market demand and supply. Even your original article doesn't prove that other than the CEO sucks and he doesn't deserve his pay.

That happens, not just to CEO but jobs at every level. It's just that you, Obama and liberal are trying to start this class warfare and CEO and other rich people are your prime target.

1) It's quite telling that you cut off the other part of that quote (you have no argument) "More tellingly, the chief executive is likely to find even more friends on the compensation committees of corporate boards — almost 50 percent."

2) CEO's should have ZERO friends on the board.

3) INTERLOCKING DIRECTORATES YOU MORON

 

[bfdd]

You HAVE no choice. This isn't one or two companies that are doing this, this is a disease that's spread from one board room to another (INTERLOCKING FUCKING DIRECTORATES). What are you going to suggest to me next, 'don't buy anything that's made in China'?

No, I always have a choice. I can refuse to be a part of society completely if I so fucking feel like it. There's always a choice some are just have the illusion of being harder to make. What? Afraid no one would go along with it? Is that why? Wah. Who's the fucking tool? You my friend because you're arguing with the wrong person if you think I honestly give a fuck. I consider what I do now "playing in society". That's how I live my life because to fucking many of you take every little thing way to seriously(not that this is a little thing mind you, just making a comment).


Just to add to a list of choices, you could make your own clothes. Make sure the materials don't come from someone you disapprove of. You could grow your own food or make sure your food comes from someone you approve of. You can barter for these things even, fuck the currency system. There's a TON of things you can do to drop off and not participate.

btw don't think I don't agree with you on how ridiculous it is. I completely agree, my feelings towards such just aren't as strong.

 

[Phokus]

No, I always have a choice. I can refuse to be a part of society completely if I so fucking feel like it. There's always a choice some are just have the illusion of being harder to make. What? Afraid no one would go along with it? Is that why? Wah. Who's the fucking tool? You my friend because you're arguing with the wrong person if you think I honestly give a fuck. I consider what I do now "playing in society". That's how I live my life because to fucking many of you take every little thing way to seriously(not that this is a little thing mind you, just making a comment).


Just to add to a list of choices, you could make your own clothes. Make sure the materials don't come from someone you disapprove of. You could grow your own food or make sure your food comes from someone you approve of. You can barter for these things even, fuck the currency system. There's a TON of things you can do to drop off and not participate.

btw don't think I don't agree with you on how ridiculous it is. I completely agree, my feelings towards such just aren't as strong.

Oh, by 'choice', you mean the 'choice' between living like it's the 18th century and living in the modern world. My definition of 'choice' is being able to buy from and invest in companies that not only have a good corporate structure but are actually able compete. We're not speaking the same language here.

 

[Spikesoldier]

how are you going to attract the best CEO's to run your company without offering comparable compensation?

getting a 'value' CEO to run you company can run you, shareholders, and employees into the dirt.

 

[Phokus]

how are you going to attract the best CEO's to run your company without offering comparable compensation?

getting a 'value' CEO to run you company can run you, shareholders, and employees into the dirt.

That's not really relevant at all when the corporate boards are practically conspiring in unison to continually bump CEO pay higher than what they would naturally be if the boards had an arms length relationship with the CEO and actually looked out for shareholder interests first.

 

[rchiu]

1) It's quite telling that you cut off the other part of that quote (you have no argument) "More tellingly, the chief executive is likely to find even more friends on the compensation committees of corporate boards — almost 50 percent."

2) CEO's should have ZERO friends on the board.

3) INTERLOCKING DIRECTORATES YOU MORON

1) you gotta be hired first before you get to the compensation committees
2) not gonna happen
3) deal with it, that's how capitalism work. Yeah there are gonna be some people at the top with good network. But there are some check and balances in place, like the Clayton Antitrust act. Yeah it's not perfect, this is not a perfect world. But better than bunch of politicians and liberals with no clue about business telling the business world how it should work. God knows we already have all these f'ing regulation like SOX...blah blah.

And btw, even though I make 6 digit too and work in large Financial related IT implementation, often dealing with C-level, I don't pretend I know everything like some of you people do.

 

[Spikesoldier]

That's not really relevant at all when the corporate boards are practically conspiring in unison to continually bump CEO pay higher than what they would naturally be if the boards had an arms length relationship with the CEO and actually looked out for shareholder interests first.

a CEO's job is rather demanding as far as hours go, most of these guys are in it for strictly the money or perks.

sadly its rare to see a loyal CEO. its the pervasive effect of greed. you can bet that from the bottom to the top of the corporate ladder its an exponential relationship.

 

[Bowfinger]

That's not really relevant at all when the corporate boards are practically conspiring in unison to continually bump CEO pay higher than what they would naturally be if the boards had an arms length relationship with the CEO and actually looked out for shareholder interests first.

Your efforts are valiant, but you cannot force the blind to see. They have been indoctrinated into knowing it is heresy to question corporations and capitalism.

 

[bfdd]

Oh, by 'choice', you mean the 'choice' between living like it's the 18th century and living in the modern world. My definition of 'choice' is being able to buy from and invest in companies that not only have a good corporate structure but are actually able compete. We're not speaking the same language here.

Oh... so you're angry at government then. They have been fucking us over by regulating in giant businesses favors since the robber barons. They never went away, they paid to hide themselves from us. Absolutely we need to tear down the regulations that hinder small/medium business from being able to enter the market place and compete with giant corporations. We need laxer employment regulations, environmental regulations and trade regulations among the states to do so. We would also require stiffer regulation in places of finance and probably have to figure out a way to lock down lobbying. My thing is you're ideals are noble, your cross hairs just aren't big enough.

btw before you quote this and say I'm leaving a bunch of things out, OBVIOUSLY I FUCKING AM. I'm not going to write a goddamn essay here.

 

[Bowfinger]

Oh... so you're angry at government then. They have been fucking us over by regulating in giant businesses favors since the robber barons. They never went away, they paid to hide themselves from us. Absolutely we need to tear down the regulations that hinder small/medium business from being able to enter the market place and compete with giant corporations. We need laxer employment regulations, environmental regulations and trade regulations among the states to do so. We would also require stiffer regulation in places of finance and probably have to figure out a way to lock down lobbying. My thing is you're ideals are noble, your cross hairs just aren't big enough.

For someone who angrily insists he is not partisan, you sure do a great job of parroting the GOP talking points.

You are quite correct, however, that big business uses its deep pockets to corrupt government. One of the many reasons we need to abolish the two legal fictions that money is protected speech and that organizations are entitled to all the same Constitutional rights as individuals.

 

[Patranus]

This is the problem with you people. Even my father-in-law who is the CFO of a smaller company says its a huge problem. I, somebody who has a plethora of financial education, says it is a problem. Yet, some blowhard like you, who will suck the dick of any rich person to get rich, doesn't give a flying fuck through a rolling donut. CEO pay has outstripped worker pay by multiples while stocks have languished.

Get a goddamn clue.

How does CEO pay impact your ability to be successful and make money?

(Hint: it doesn't because it is irrelevant)

Pay is dictated by the free market. There is a world full of people with your skill set so you cannot expect to make that much money.

 

[the DRIZZLE]

I agree with Phokus and LK on this one, the high CEO pay is largely the result of the corruption of corporate boards. However, I think Phokus overstates the importance of interlocking directorates. There are lots of opportunistically for shenanigans even without interlocking directorates.

The problem is there is just no incentive for politicians to fix the issue. No one is going to run on improving corporate governance and many political donors likely benefit from the current systems.

 

[Phokus]

1) you gotta be hired first before you get to the compensation committees
2) not gonna happen
3) deal with it, that's how capitalism work. Yeah there are gonna be some people at the top with good network. But there are some check and balances in place, like the Clayton Antitrust act. Yeah it's not perfect, this is not a perfect world. But better than bunch of politicians and liberals with no clue about business telling the business world how it should work. God knows we already have all these f'ing regulation like SOX...blah blah.

And btw, even though I make 6 digit too and work in large Financial related IT implementation, often dealing with C-level, I don't pretend I know everything like some of you people do.

The reason why you don't know 'everything' is because you only read about GOP talking points/AYN Rand novels. Also, being an IT geek doesn't necessarily give you the financial view that you would need to see this sort of looting.

I've seen the following (over several companies i've worked in):

1) An internal auditor constantly catching company VP's/Presidents using their expense accounts like their own personal slush fund (i.e. one buying several Ipads, ostensibly for her family). She brought some of these things to the head of the Audit department (she was rebuked) and even the Audit commitee (which is technically under the board of directors, she was ignored).

2) When one of the companies i was in had several terrible quarters during the financial meltdown, they went through all expenses with a fine tooth comb. Everything got slashed. We even lost our water dispensers and k-cup coffee dispensers. Yet somehow, they were able to fund a 'sales conference' trip to the Caribbean (at a cost of almost 2 million dollars). And this wasn't for sales people either, basically all VP and higher execs were invited.

3) The CEO magically getting a raise, even though the stock lost half it's value over the 5+ years he was CEO.

Apparently though, you've worked in companies run by ANGELS.

 

[Nebor]

What's your point here? Short of nationalizing all these companies, I don't really see how it's your business.

They're private companies. They can run themselves however they want. If you don't like it, don't work for them, don't buy their stuff, don't buy their stock. Look to that other 10% of companies that don't pay their executives competitively for your employment, consumer and investment needs.

Or head down to your local country club and start angling for a job as a CEO. I mean it's all connections and no talent, right?

If Amgen decided to start paying all their lab tech's $1 million a year, would you be in here throwing a fit about that? They'd have the best lab techs in the world, wouldn't they? Would it matter if the CEO or one of the board members used to be a lab tech?

 

[Nebor]

The reason why you don't know 'everything' is because you only read about GOP talking points/AYN Rand novels. Also, being an IT geek doesn't necessarily give you the financial view that you would need to see this sort of looting.

I've seen the following (over several companies i've worked in):

1) An internal auditor constantly catching company VP's/Presidents using their expense accounts like their own personal slush fund (i.e. one buying several Ipads, ostensibly for her family). She brought some of these things to the head of the Audit department (she was rebuked) and even the Audit commitee (which is technically under the board of directors, she was ignored).

2) When one of the companies i was in had several terrible quarters during the financial meltdown, they went through all expenses with a fine tooth comb. Everything got slashed. We even lost our water dispensers and k-cup coffee dispensers. Yet somehow, they were able to fund a 'sales conference' trip to the Caribbean (at a cost of almost 2 million dollars). And this wasn't for sales people either, basically all VP and higher execs were invited.

3) The CEO magically getting a raise, even though the stock lost half it's value over the 5+ years he was CEO.

Apparently though, you've worked in companies run by ANGELS.

It definitely sounds like you should make the career move to executive management, because you sound green with envy.

 

[the DRIZZLE]

1) you gotta be hired first before you get to the compensation committees
2) not gonna happen
3) deal with it, that's how capitalism work. Yeah there are gonna be some people at the top with good network. But there are some check and balances in place, like the Clayton Antitrust act. Yeah it's not perfect, this is not a perfect world. But better than bunch of politicians and liberals with no clue about business telling the business world how it should work. God knows we already have all these f'ing regulation like SOX...blah blah.

And btw, even though I make 6 digit too and work in large Financial related IT implementation, often dealing with C-level, I don't pretend I know everything like some of you people do.

Capitalism needs regulation. Good corporate governance is essential to having a strong dynamic economy. If you want to see a good example of why look at Gazprom. Based on its reserves it should be worth over $1 trillion, yet the market cap is only pennies on the dollar. The reason why is Russia's terrible corporate governance. To put it more directly good corporate governance increases economic efficiency.

 

[Phokus]

What's your point here? Short of nationalizing all these companies, I don't really see how it's your business.

They're private companies. They can run themselves however they want. If you don't like it, don't work for them, don't buy their stuff, don't buy their stock. Look to that other 10% of companies that don't pay their executives competitively for your employment, consumer and investment needs.

Or head down to your local country club and start angling for a job as a CEO. I mean it's all connections and no talent, right?

If Amgen decided to start paying all their lab tech's $1 million a year, would you be in here throwing a fit about that? They'd have the best lab techs in the world, wouldn't they? Would it matter if the CEO or one of the board members used to be a lab tech?

In summary: "Most companies are fucked, only do businesses/have a relationship with the few that aren't". This is a realistic option for the overwhelming majority of Americans. Especially the 20%+ that are unemployed/underemployed.

If you aren't outraged about this, you ARE the problem.

 

[bfdd]

For someone who angrily insists he is not partisan, you sure do a great job of parroting the GOP talking points.

You are quite correct, however, that big business uses its deep pockets to corrupt government. One of the many reasons we need to abolish the two legal fictions that money is protected speech and that organizations are entitled to all the same Constitutional rights as individuals.

I do agree that money isn't speech and that organizations are not people. If they are GOP talking points, that has no basis on my opinion of them. My personal experience in many different levels of labor and white collar work along with observation of the world around me with all the failing small and medium business. The key isn't to writing more regulation though. The key is to ripping back the bullshit regulations that have been piled on top giving big business the advantage. Sure we think all these goodie good regulations for the environment are "helping" us. They don't help anyone but line the pockets of the people that paid to have it written. We might think adding extra regulations on top of just forcing the government to protect our first amendment rights is a good thing because it "protects the little man" lol no it doesn't. It just uses government to create more big men at the top, you know those guys we like to call "union leaders".