C.E.O.'s Salaries

[crankedup5]

Equality Trust offer some very interesting reports and facts on many aspects including CEO pay packages. Seven out of ten U.K. persons want Government to crack down on soaring CEO pay amongst many other matters. Worth a read through.

equalitytrust.org.uk

[Biggy Stardust]

A500leroy said:

Cheers chaps a bit clearer now, they kind of deserve what they get, but the difference between the bottom and them seems to be getting wider which does appear to be wrong.

As long as you get what you contracted for, what business is it of yours what others receive?

[Gecko1978]

Dynion Araf Uchaf said:

a CEO of a FTSE 100 company is essentially a world champion of business. You need that level of skill, cunning, luck and desire as a world champion would need to reach the top of their sport.

You've also go to be tough, take a lot of flack, and spend your time reading about your industry, and learning about trends etc. To be really good, you've got to be really motivated to understand your business. And then whatever you earn is not enough, but it gets to the point where the money is not important, its the results that lead to the satisfaction. Oh and you have to like or indeed thrive on conflict. Putting one over on your C suite to show who is in charge. I thinks that's one of the reasons that some companies want to stop home working. These CEO's like to see the whites of your eyes.

Basically thus they are premiership works if you like just like in football some are better than others but they are all good. When it goes wrong it's very bad. Dick Fold springs to mind

[stongle]

Newc said:

You're also extrapolating and comparing your salary to CEO levels. Senior management is not paid like that, as per the Apple comment above. There's a base salary - not underplaying that, it's usually a good chunk - but the big money comes from options and other variable pay that is directly linked to the company's performance.

CEO only gets paid out when the owners make money, and the owners are happy to give up a proportion of their returns to the CEO.

It's about risk, personal risk and ownership. There are 10s of 1000's of CEOs few get rewarded by failure. They have reached the top of the tree by taking personal risk and responsibility. Waaaaaaayy beyond what a normal worker would be prepared to take. Sure some appear to bounce around and get rewarded for failure, but in general the pay is consumate to the risks at that level. In finance, the CEO is legally responsible for everything under him - that's 1000s of employees who could go rogue (and they do).

Are they ALL worth it? Absolutely not, are some - absolutely.

[A500leroy]

Biggy Stardust said:

A500leroy said:

Cheers chaps a bit clearer now, they kind of deserve what they get, but the difference between the bottom and them seems to be getting wider which does appear to be wrong.

As long as you get what you contracted for, what business is it of yours what others receive?

Because i think it would be loverly if we lived in a world where no human in any country let alone ours needed such things as food banks or government grants to turn the heating on. Maybe if the gap was lower and the profits of companies where a little more equally split we'd get somewhere near?

[deckster]

crankedup5 said:

Equality Trust offer some very interesting reports and facts on many aspects including CEO pay packages. Seven out of ten U.K. persons want Government to crack down on soaring CEO pay amongst many other matters. Worth a read through.

equalitytrust.org.uk

I broadly agree with what they're saying, although I think government intervention is the wrong way to go about it.

At the same time "I think other people who earn lots more than me, should in fact earn less" isn't in itself a terribly revealing insight.

[valiant]

Biggy Stardust said:

A500leroy said:

Cheers chaps a bit clearer now, they kind of deserve what they get, but the difference between the bottom and them seems to be getting wider which does appear to be wrong.

As long as you get what you contracted for, what business is it of yours what others receive?

And yet people do exactly that on the RMT thread.

Funny that.

[Newc]

A500leroy said:

Because i think it would be loverly if we lived in a world where no human in any country let alone ours needed such things as food banks or government grants to turn the heating on. Maybe if the gap was lower and the profits of companies where a little more equally split we'd get somewhere near?

Would you prefer (and I'm not having a pop, genuinely curious) that the state provides any of these services in the public sector, as a monopoly (so no private sector allowed), with public sector compensation models:

- supermarkets
- football clubs
- legal advice
- aircraft engine manufacturing
- healthcare
- retail banking: current accounts, loans, mortgages
- petrol stations
- coach services
- mobile phone networks

[stongle]

Newc said:

Would you prefer (and I'm not having a pop, genuinely curious) that the state provides any of these services in the public sector, as a monopoly (so no private sector allowed), with public sector compensation models:

- supermarkets
- football clubs
- legal advice
- aircraft engine manufacturing
- healthcare
- retail banking: current accounts, loans, mortgages
- petrol stations
- coach services
- mobile phone networks

Curiously specific list.

Looking forward to what comes next.

[lauda]

Gecko1978 said:

Basically thus they are premiership works if you like just like in football some are better than others but they are all good. When it goes wrong it's very bad. Dick Fold springs to mind

Yeah. Dick Fuld must be ruing the day he sank Lehman. He’s only worth $250m.

He should be in a jail cell.

[Biggy Stardust]

valiant said:

Biggy Stardust said:

A500leroy said:

Cheers chaps a bit clearer now, they kind of deserve what they get, but the difference between the bottom and them seems to be getting wider which does appear to be wrong.

As long as you get what you contracted for, what business is it of yours what others receive?

And yet people do exactly that on the RMT thread.

Funny that.

It's our business when the people in question disrupt others' lives. CEOs tend not to do so.

Some other people make more than me, some less. That's life. My life won't be made better by comparisons so I don't do that. There seems to be a lot of jealousy about CEOs getting more than non-CEOs; if it matters that much then become a CEO or try to employ one.

[bristolbaron]

A500leroy said:

Biggy Stardust said:

A500leroy said:

Cheers chaps a bit clearer now, they kind of deserve what they get, but the difference between the bottom and them seems to be getting wider which does appear to be wrong.

As long as you get what you contracted for, what business is it of yours what others receive?

Because i think it would be loverly if we lived in a world where no human in any country let alone ours needed such things as food banks or government grants to turn the heating on. Maybe if the gap was lower and the profits of companies where a little more equally split we'd get somewhere near?

Let's take a look...

https://www.energyvoice.com/oilandgas/europe/39428...

Shell's CEO received £6.1m in 2021 (Incl £2.1m bonus)
Shell has 87,000 employees with an average salary of £119,112. His salary was 57 times higher than average.

Let's say its unfair he receives so much, so we reduce him down to the average (£119,112) and split the rest between the staff team as a bonus. Everyone gets an extra £68.74. It's probably not a good idea to lose your CEO to give everyone an extra fiver a month.

[768]

A500leroy said:

Because i think it would be loverly if we lived in a world where no human in any country let alone ours needed such things as food banks or government grants to turn the heating on. Maybe if the gap was lower and the profits of companies where a little more equally split we'd get somewhere near?

If you make the gap smaller, other companies out compete them, or the gap wouldn’t be what it is. If you make companies less productive there will be less to go around, not more.

[crankedup5]

CEO a pay ratios against the worker average pay has gone from x 20 in the 1960s to x280 now.
That represents quite some climb in the differential gap.
Unfortunately the worse of the excesses attract the National media attention, and rightly so. Take the case of the former CEO persimmon homes as an example.

[crankedup5]

deckster said:

crankedup5 said:

Equality Trust offer some very interesting reports and facts on many aspects including CEO pay packages. Seven out of ten U.K. persons want Government to crack down on soaring CEO pay amongst many other matters. Worth a read through.

equalitytrust.org.uk

I broadly agree with what they're saying, although I think government intervention is the wrong way to go about it.

At the same time "I think other people who earn lots more than me, should in fact earn less" isn't in itself a terribly revealing insight.

The report of 2011 reveals some eye watering facts and numbers regarding the issue. For me it is and always has been the owners of the FTSE Companies that hold the key to changing decisions made by remnumeration Boards. Having said that I don’t expect anything of substance to change any time soon.

[A500leroy]

bristolbaron said:

A500leroy said:

Biggy Stardust said:

A500leroy said:

Cheers chaps a bit clearer now, they kind of deserve what they get, but the difference between the bottom and them seems to be getting wider which does appear to be wrong.

As long as you get what you contracted for, what business is it of yours what others receive?

Because i think it would be loverly if we lived in a world where no human in any country let alone ours needed such things as food banks or government grants to turn the heating on. Maybe if the gap was lower and the profits of companies where a little more equally split we'd get somewhere near?

Let's take a look...

https://www.energyvoice.com/oilandgas/europe/39428...

Shell's CEO received 6.1m in 2021 (Incl 2.1m bonus)
Shell has 87,000 employees with an average salary of 119,112. His salary was 57 times higher than average.

Let's say its unfair he receives so much, so we reduce him down to the average ( 119,112) and split the rest between the staff team as a bonus. Everyone gets an extra 68.74. It's probably not a good idea to lose your CEO to give everyone an extra fiver a month.

If you took it away from money and paid in bread. Lets say the ceo gets 200 loaves a year and the average worker gets 10.
Wouldnt it be a nicer world if the ceo had 150 loaves (he'd still have plenty to eat) and the rest was dived between the workers who would have a little more to eat than they would have previously done.

[Electro1980]

stongle said:

It's about risk, personal risk and ownership. There are 10s of 1000's of CEOs few get rewarded by failure. They have reached the top of the tree by taking personal risk and responsibility. Waaaaaaayy beyond what a normal worker would be prepared to take. Sure some appear to bounce around and get rewarded for failure, but in general the pay is consumate to the risks at that level. In finance, the CEO is legally responsible for everything under him - that's 1000s of employees who could go rogue (and they do).

Bullst. When has a CEO ever been punished for the behaviour of a rogue employee? They are only responsible in the case of neglect or if they are complicit. CEOs do not have that much personal risk.

[DeltonaS]

bristolbaron said:

A500leroy said:

Biggy Stardust said:

A500leroy said:

Cheers chaps a bit clearer now, they kind of deserve what they get, but the difference between the bottom and them seems to be getting wider which does appear to be wrong.

As long as you get what you contracted for, what business is it of yours what others receive?

Because i think it would be loverly if we lived in a world where no human in any country let alone ours needed such things as food banks or government grants to turn the heating on. Maybe if the gap was lower and the profits of companies where a little more equally split we'd get somewhere near?

Let's take a look...

https://www.energyvoice.com/oilandgas/europe/39428...

Shell's CEO received 6.1m in 2021 (Incl 2.1m bonus)
Shell has 87,000 employees with an average salary of 119,112. His salary was 57 times higher than average.

Let's say its unfair he receives so much, so we reduce him down to the average ( 119,112) and split the rest between the staff team as a bonus. Everyone gets an extra 68.74. It's probably not a good idea to lose your CEO to give everyone an extra fiver a month.

Like I said, cultural differences:

Research commissioned by The Wall Street Journal of about half of S&P500 companies shows that CEOs benefited more than the ordinary employee. The median income (line up all CEOs, half are on the left and half are on the right of the one with the median income) of chief executives has risen from $13.6 million to $14.2 million. However, most bosses receive an increase of 11 percent or more. Half of the companies surveyed say their employee's median income rose by a paltry 3.1 percent. In these times you can hardly call that inflation compensation.

A CEO takes an average of 186 times the salary of the median employee, compared to 166 times a year earlier.

https://www.wsj.com/articles/ceo-pay-heads-for-rec...

[768]

A500leroy said:

If you took it away from money and paid in bread. Lets say the ceo gets 200 loaves a year and the average worker gets 10.
Wouldnt it be a nicer world if the ceo had 150 loaves (he'd still have plenty to eat) and the rest was dived between the workers who would have a little more to eat than they would have previously done.

Sure. But if you do that the CEO will go elsewhere and next year there won’t be 210 loaves, there will be 150. Then you’ll give the CEO 90 loaves and they’ll move on, etc until there are no loaves.

The loaves aren’t magic ones that come with a guaranteed supply.

[DeltonaS]

Electro1980 said:

stongle said:

It's about risk, personal risk and ownership. There are 10s of 1000's of CEOs few get rewarded by failure. They have reached the top of the tree by taking personal risk and responsibility. Waaaaaaayy beyond what a normal worker would be prepared to take. Sure some appear to bounce around and get rewarded for failure, but in general the pay is consumate to the risks at that level. In finance, the CEO is legally responsible for everything under him - that's 1000s of employees who could go rogue (and they do).

Bullst. When has a CEO ever been punished for the behaviour of a rogue employee? They are only responsible in the case of neglect or if they are complicit. CEOs do not have that much personal risk.

Personal CEO liability is a fairly new subject, probably really started since the financial crisis of 2007/2008.

I think this will develop even further in the comming decades.

What's also changed these past decades is the way CEO's are compensated, there's a shift from short term to long term incentives. Plus additional clawback arangements.

Edited by DeltonaS on Thursday 26th May 19:19