This must be the 10th time I comment this on Lemmy and you might already know this, but:
The reason a CEO gets paid what he gets paid is not because of the value he adds to the company (as you pointed out, anyone could do the job), but because when the company fucks up (whether due to his decisions, or those of the board, or just anything, really), he takes the fall so the company can keep on doing whatever shady shit they’re doing and the board can act like they had no idea what was going on.
It’s not that they take responsibility, but rather in extreme circumstances they take the plunge and resign, or they’re fired. So the company can say they’re turning a new leaf
Examples from a quick search:
Hank McKinnell, CEO of Pfizer, received a US$188 million severance package after his resignation, even after a 44% decline in the company’s stock value since he took over in 2001.
Jeff Smisek, the former CEO of United Airlines, received a separation payment of $4.875 million in cash along with additional equity awards and other benefits for a total of close to $37 million.
United was in the middle of a corruption scandal and of course he took the fall, but I’m 100% sure he wasn’t acting alone.
Shady companies are always gonna be shady. But they’ll oust a CEO every now and then to pretend like they’re gonna change.
This must be the 10th time I comment this on Lemmy and you might already know this, but:
The reason a CEO gets paid what he gets paid is not because of the value he adds to the company (as you pointed out, anyone could do the job), but because when the company fucks up (whether due to his decisions, or those of the board, or just anything, really), he takes the fall so the company can keep on doing whatever shady shit they’re doing and the board can act like they had no idea what was going on.
I don’t think I’ve seen enough CEOs take responsibility.
It’s not that they take responsibility, but rather in extreme circumstances they take the plunge and resign, or they’re fired. So the company can say they’re turning a new leaf
Examples from a quick search:
Hank McKinnell, CEO of Pfizer, received a US$188 million severance package after his resignation, even after a 44% decline in the company’s stock value since he took over in 2001.
Jeff Smisek, the former CEO of United Airlines, received a separation payment of $4.875 million in cash along with additional equity awards and other benefits for a total of close to $37 million.
United was in the middle of a corruption scandal and of course he took the fall, but I’m 100% sure he wasn’t acting alone.
Shady companies are always gonna be shady. But they’ll oust a CEO every now and then to pretend like they’re gonna change.
Does it need that much pay for someone to take the fall?
I feel like, of that’s the primary or sole motivator to pay so much, you could get someone “to take the fall in such rare cases” for much less.
I’d certainly be willing to for 2 mil. I don’t need millions for years and then a multi-million severance package.
Thing is, you may have to go to jail, depending on what the company is caught doing. Your name will be all over the news too.