At last Shareholders speak-Barclays Bank
Discussion
RYH64E said:
If I were convinced that the success of the organisation was dependent on the vision of the chief executive then I would agree it was OK, but in the vast majority of cases I don't think that it is.
That is a very interesting perspective from a business owner as I believe from your previous post you are, or do you only apply that to other businesses not your own? Which if you are I noticed you very nicely avoided the direct question(s) and went with yet more rhetoric! RYH64E said:
but when the s
t hit the fan it was the shareholders that took the biggest losses - not the highly paid former employees whose losses were largely limited to loss of salary.
I think you'll fine Fred Goowin would have had hundreds of thousands of shares in the company, and suffered a huge personal financial loss followng the collapse. Yes, still a rich man, but not nearly as rich as he was.t hit the fan it was the shareholders that took the biggest losses - not the highly paid former employees whose losses were largely limited to loss of salary.Anyway, re Bob Diamond, what's so wonderful about £2m a year anyway. I suspect it's enough to give him a few nice properties, some decent cars, kids in private school, and a very nice lifestyle, but it's hardly private jet and super yatch at Monte Carlo territory.
I don't think £2m is a massive amount to run an organisation like Barclays. And if Barclays didn't pay it, someone else would, because he's a proven performer.
Everyone can try and justify their disapproval til the cows come hme, but it's pure envy, nothing more, nothing less.
heppers75 said:
That is a very interesting perspective from a business owner as I believe from your previous post you are, or do you only apply that to other businesses not your own? Which if you are I noticed you very nicely avoided the direct question(s) and went with yet more rhetoric!
My employees received an average 8% pay increase based on last years results and sales staff get performance related bonuses, all pretty standard stuff and certainly noting that would be considered contentious.The difference between my business and the kind of businesses that we have been discussing (apart from the obvious difference in size, I have 10 employees) is that my business was founded by me, every important decision is taken by me, the money tied up in the business is mine, and if it all goes wrong the biggest loser will be me (and my family). My earnings are entirely dependant on the performance of the business, the amount is decided by the Directors (me), and approved by the shareholders (again, me).
I have a huge amount of respect for those people who have created successful, global businesses and would never begrudge them a penny of their earnings - no matter how high. I have no problem at all with high pay, I just differentiate between visionary entrepeneurs and highly paid administrators who risk nothing personally. The last lot did very well out of the banks in the good times and the shareholders took the losses when it turned out that the executives weren't actually that good, time will tell if the same is going to happen again.
RYH64E said:
heppers75 said:
That is a very interesting perspective from a business owner as I believe from your previous post you are, or do you only apply that to other businesses not your own? Which if you are I noticed you very nicely avoided the direct question(s) and went with yet more rhetoric!
My employees received an average 8% pay increase based on last years results and sales staff get performance related bonuses, all pretty standard stuff and certainly noting that would be considered contentious.The difference between my business and the kind of businesses that we have been discussing (apart from the obvious difference in size, I have 10 employees) is that my business was founded by me, every important decision is taken by me, the money tied up in the business is mine, and if it all goes wrong the biggest loser will be me (and my family). My earnings are entirely dependant on the performance of the business, the amount is decided by the Directors (me), and approved by the shareholders (again, me).
I have a huge amount of respect for those people who have created successful, global businesses and would never begrudge them a penny of their earnings - no matter how high. I have no problem at all with high pay, I just differentiate between visionary entrepeneurs and highly paid administrators who risk nothing personally. The last lot did very well out of the banks in the good times and the shareholders took the losses when it turned out that the executives weren't actually that good, time will tell if the same is going to happen again.
Do any of your 10 employees get paid a wage and or wage + bonus that equals say a single digit percentage of your profit?
heppers75 said:
A very laudable post sir, I will however I am afraid to say ask the question again but perhaps do so slightly more directly.
Do any of your 10 employees get paid a wage and or wage + bonus that equals say a single digit percentage of your profit?
Of course, my turnover and profits are very modest in the grand scheme of things so salaries and bonuses represent a very large percentage of both turmover and profit. Do any of your 10 employees get paid a wage and or wage + bonus that equals say a single digit percentage of your profit?
Let me ask you a question, do you think that the bank executives in post leading up to the crash of 2007/2008 were worth the salary and bonuses they were paid in the preceding years?
RYH64E said:
heppers75 said:
A very laudable post sir, I will however I am afraid to say ask the question again but perhaps do so slightly more directly.
Do any of your 10 employees get paid a wage and or wage + bonus that equals say a single digit percentage of your profit?
Of course, my turnover and profits are very modest in the grand scheme of things so salaries and bonuses represent a very large percentage of both turmover and profit. Do any of your 10 employees get paid a wage and or wage + bonus that equals say a single digit percentage of your profit?
Let me ask you a question, do you think that the bank executives in post leading up to the crash of 2007/2008 were worth the salary and bonuses they were paid in the preceding years?
most brought in were to bring the banks up to the standard they were at before and yet they are doing that ok, they are still vilified, yet are not the same people.
RYH64E said:
heppers75 said:
A very laudable post sir, I will however I am afraid to say ask the question again but perhaps do so slightly more directly.
Do any of your 10 employees get paid a wage and or wage + bonus that equals say a single digit percentage of your profit?
Of course, my turnover and profits are very modest in the grand scheme of things so salaries and bonuses represent a very large percentage of both turmover and profit. Do any of your 10 employees get paid a wage and or wage + bonus that equals say a single digit percentage of your profit?
Let me ask you a question, do you think that the bank executives in post leading up to the crash of 2007/2008 were worth the salary and bonuses they were paid in the preceding years?
As for your question - By and large yes, they were employees of businesses that were posting profits that sustained their remuneration. Did those people at those points make good decisions no they did not and I believe it is why they are no longer in those positions. Much like I suspect if one of your sales folks failed to perform you would get rid of him/her but by the same token I do not think you would hold his/her sucessor responsible for his/her predecessors mistakes - or would you? As you do seem to be doing that with regards to this argument.
TwigtheWonderkid said:
I think you'll fine Fred Goowin would have had hundreds of thousands of shares in the company, and suffered a huge personal financial loss followng the collapse. Yes, still a rich man, but not nearly as rich as he was.
Anyway, re Bob Diamond, what's so wonderful about £2m a year anyway. I suspect it's enough to give him a few nice properties, some decent cars, kids in private school, and a very nice lifestyle, but it's hardly private jet and super yatch at Monte Carlo territory.
I don't think £2m is a massive amount to run an organisation like Barclays. And if Barclays didn't pay it, someone else would, because he's a proven performer.
Everyone can try and justify their disapproval til the cows come hme, but it's pure envy, nothing more, nothing less.
£2m would be a lot, but maybe not excessive, the reports however suggest that his package is worth a lot more than that - £17.7m quoted here http://www.telegraph.co.uk/finance/newsbysector/ba... in return for presiding over a wholly unremarkable RoE of 6.6%.Anyway, re Bob Diamond, what's so wonderful about £2m a year anyway. I suspect it's enough to give him a few nice properties, some decent cars, kids in private school, and a very nice lifestyle, but it's hardly private jet and super yatch at Monte Carlo territory.
I don't think £2m is a massive amount to run an organisation like Barclays. And if Barclays didn't pay it, someone else would, because he's a proven performer.
Everyone can try and justify their disapproval til the cows come hme, but it's pure envy, nothing more, nothing less.
heppers75 said:
Which was always going to be the answer, so therefore what I do not understand is that why is that a formula you are happy to propagate but not support?
As for your question - By and large yes, they were employees of businesses that were posting profits that sustained their remuneration. Did those people at those points make good decisions no they did not and I believe it is why they are no longer in those positions. Much like I suspect if one of your sales folks failed to perform you would get rid of him/her but by the same token I do not think you would hold his/her sucessor responsible for his/her predecessors mistakes - or would you? As you do seem to be doing that with regards to this argument.
'Failed to perform' is a bit of an understatement for what happened to the banking sector back 2007/2008! If one of my people cocked up to the same extent that those bank executives did they wouldn't have a successor, my company wouldn't be bailed out by the government and I'd lose all of my investment - which is how it should be. As for your question - By and large yes, they were employees of businesses that were posting profits that sustained their remuneration. Did those people at those points make good decisions no they did not and I believe it is why they are no longer in those positions. Much like I suspect if one of your sales folks failed to perform you would get rid of him/her but by the same token I do not think you would hold his/her sucessor responsible for his/her predecessors mistakes - or would you? As you do seem to be doing that with regards to this argument.
If I were a long term Barclays shareholder I wouldn't be as charitable as you, your Barclays shares peaked at nearly £8 in 2007, dropped to well below £1 and have since recovered to £2ish, with a wholly unremarkable RoE of 6.6%, I think the shareholders have had a pretty s
tty deal in comparison with their employees, past and present.RYH64E said:
TwigtheWonderkid said:
I think you'll fine Fred Goowin would have had hundreds of thousands of shares in the company, and suffered a huge personal financial loss followng the collapse. Yes, still a rich man, but not nearly as rich as he was.
Anyway, re Bob Diamond, what's so wonderful about £2m a year anyway. I suspect it's enough to give him a few nice properties, some decent cars, kids in private school, and a very nice lifestyle, but it's hardly private jet and super yatch at Monte Carlo territory.
I don't think £2m is a massive amount to run an organisation like Barclays. And if Barclays didn't pay it, someone else would, because he's a proven performer.
Everyone can try and justify their disapproval til the cows come hme, but it's pure envy, nothing more, nothing less.
£2m would be a lot, but maybe not excessive, the reports however suggest that his package is worth a lot more than that - £17.7m quoted here http://www.telegraph.co.uk/finance/newsbysector/ba... in return for presiding over a wholly unremarkable RoE of 6.6%.Anyway, re Bob Diamond, what's so wonderful about £2m a year anyway. I suspect it's enough to give him a few nice properties, some decent cars, kids in private school, and a very nice lifestyle, but it's hardly private jet and super yatch at Monte Carlo territory.
I don't think £2m is a massive amount to run an organisation like Barclays. And if Barclays didn't pay it, someone else would, because he's a proven performer.
Everyone can try and justify their disapproval til the cows come hme, but it's pure envy, nothing more, nothing less.
So again where is the issue? I mean apart from envy of the amount where is the issue seriously?
ETA to add rather than make multiple posts... Erm Barclays were not bailed out by the government and I only paid 97p for my at the time £20k of Barclays shares, so I am very happy thanks!
Edited by heppers75 on Saturday 28th April 21:31
heppers75 said:
Barclays Equity is £55bn so a 6.6% return is £3.6bn... Even if £17.7m was accurate is is equivalent to about 0.5% to the CEO - again a sh*t load of cash but as a % of return infinitesimal and a dam site less than you have admitted you pay your staff.
So again where is the issue? I mean apart from envy of the amount where is the issue seriously?
ETA to add rather than make multiple posts... Erm Barclays were not bailed out by the government and I only paid 97p for my at the time £20k of Barclays shares, so I am very happy thanks!
I think we've nearly done this to death, but the last point I'd make is that in my world employees get a wage and usually a percentage of that wage as a bonus if they do well. Profit is for the shareholders not employees, and it is disingenuous to express an employee's bonus as a percentage of the organisation's profit as said profit is usually determined largely by the size of the organisation and the total capital employed. RoE is a more objective measure of success, and there Barclays haven't done great. So again where is the issue? I mean apart from envy of the amount where is the issue seriously?
ETA to add rather than make multiple posts... Erm Barclays were not bailed out by the government and I only paid 97p for my at the time £20k of Barclays shares, so I am very happy thanks!
Edited by heppers75 on Saturday 28th April 21:31
(And I do of course know that Barclays didn't get a government bail out, I was referring to the industry as a whole in a somewhat flippant tone).
RYH64E said:
heppers75 said:
Barclays Equity is £55bn so a 6.6% return is £3.6bn... Even if £17.7m was accurate is is equivalent to about 0.5% to the CEO - again a sh*t load of cash but as a % of return infinitesimal and a dam site less than you have admitted you pay your staff.
So again where is the issue? I mean apart from envy of the amount where is the issue seriously?
ETA to add rather than make multiple posts... Erm Barclays were not bailed out by the government and I only paid 97p for my at the time £20k of Barclays shares, so I am very happy thanks!
I think we've nearly done this to death, but the last point I'd make is that in my world employees get a wage and usually a percentage of that wage as a bonus if they do well. Profit is for the shareholders not employees, and it is disingenuous to express an employee's bonus as a percentage of the organisation's profit as said profit is usually determined largely by the size of the organisation and the total capital employed. RoE is a more objective measure of success, and there Barclays haven't done great. So again where is the issue? I mean apart from envy of the amount where is the issue seriously?
ETA to add rather than make multiple posts... Erm Barclays were not bailed out by the government and I only paid 97p for my at the time £20k of Barclays shares, so I am very happy thanks!
Edited by heppers75 on Saturday 28th April 21:31
(And I do of course know that Barclays didn't get a government bail out, I was referring to the industry as a whole in a somewhat flippant tone).
Personally my perspective is somewhat opposite to yours in one respect which is that employees or at least critical ones i.e. sales and senior management that are accountable and owners of business success are very much remunerated related to the business profit. Or more accurately they are remunerated for the role they do at a market rate and then they will receive an uplift based on their value to that business which is the bit based on that business profit as if they are not they will simply move to somewhere that will remunerate them in that way as they well know they can achieve.
To use real figures for you in one of the businesses I have some involvement in there is a very good sales lady, she is frankly amazing. She is responsible for the account management of approx £6m of accounts and has consistently brought in new business year on year. Her basic is £40k with a car, phone, pension, healthcare etc. Last year she took an additional £110k in bonuses. That is approximately 15% of the net profit of the business she brings in, the MD's take is if I have to pay Alison £1m I will be the happiest man alive when I sign that cheque as it means I have a far larger one to write to myself!
What I do not get is why that does not translate to some folks for larger companies it is just because I guess it is emotive and contrary to peoples beliefs system.
Like I said, it is very unattractive as a personality trait and it is also again IMHO monumentally naive!
heppers75 said:
Last year she took an additional £110k in bonuses. That is approximately 15% of the net profit of the business she brings in, the MD's take is if I have to pay Alison £1m I will be the happiest man alive when I sign that cheque as it means I have a far larger one to write to myself!
There's a big difference between the profit on business that an individual brings in and the total organisation profit, which was the measure you used in relation to Barclays. Also a rather substantial difference in a real world £40k plus £110k bonus and an other worldly £17.7m...RYH64E said:
heppers75 said:
Last year she took an additional £110k in bonuses. That is approximately 15% of the net profit of the business she brings in, the MD's take is if I have to pay Alison £1m I will be the happiest man alive when I sign that cheque as it means I have a far larger one to write to myself!
There's a big difference between the profit on business that an individual brings in and the total organisation profit, which was the measure you used in relation to Barclays. Also a rather substantial difference in a real world £40k plus £110k bonus and an other worldly £17.7m...As for the 'other worldly' comment I think therein lays your true colours, you simply have a problem with the amount which if you cannot see how disingenuous that is then I will fall back on the age old... For those that understand no explanation is necessary and for those that do not none is possible...
Edited by heppers75 on Saturday 28th April 23:52
deadslow said:
Those who are part of the problem often fail to recognise there is a problem!
To quote Manuel - Que? You seem to be insinuating I am a part of the problem... Odd as I am in no way shape or form a part of the sector.
I am however possessed of a measurably reasonable intelligence and have an ability to make an actual argument and construct a debate based on logic and reason as opposed to rhetoric and emotion, to which end I have read precious little in opposition to anything I have said that has not been all but pure emotive rhetoric.
If you would care to alter that then please by all means do so.
ETA - In your eyes and if you at all can do it without the emotion and rhetoric what is 'the problem'?
Edited by heppers75 on Sunday 29th April 00:25
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