Capitolism

Independent in All Things, Neutral in Nothing

More on CEO Pay

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Douglas A. McIntyre of 24/7 Wall Street has a good piece on CEO pay today. He also raises a valuable point that CEO pay draws the ire of the media, shareholders and advocacy groups. But other executives at most firms also make huge money, and they never face the same scrutiny. No good ways exist to check and monitor their performances either.

Just to note, the CEO pay issue requires some serious thought. Peter Drucker, for example, urged CEOs to receive no more than 20 times the pay of the lowest person in the organization. I need to re-read his reasoning for this position.

In theory, I have no problem with outsized CEO pay, if the CEO drove outsized performance. The problem in sight is that many CEOs receive huge paychecks and long term rewards for pretty pitiful results.

More on this topic in the coming weeks and months.

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Written by Russell S.

March 9, 2010 at 8:15 pm

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