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There's a lot of suspicion that your presumption isn't accurate. It's a fairly big area of research, though. One alternate hypothesis is a form of "executive ca
by _delirium 11y ago
There's a lot of suspicion that your presumption isn't accurate. It's a fairly big area of research, though. One alternate hypothesis is a form of "executive capture", that companies nominally owned by shareholders are actually run by more of a clique of executives, who serve on each others' boards and pay each other large salaries. Some mild but inconclusive correlational evidence for that view is that when controlling for other factors (size, industry, etc.), CEOs are paid less at private companies and companies with concentrated ownership, than at companies with diffuse ownership—suggesting that when the owner is in charge and paying attention, they prefer to rein in executive pay.
- paulhauggis 11y ago"There's a lot of suspicion that your presumption isn't accurate" If this is the case, the only people that should be worried about it are the shareholders and the other people that own the company. If I was running a company and I had more money to spare (because I couldn't pay the CEO past a certain amount of money), I'm not just going to pay a worker because it sounds nice. Workers should be paid based on market value and the value they bring to the company.
- dbcfd 11y ago> If this is the case, the only people that should be worried about it are the shareholders and the other people that own the company. And the SEC is responsible for improving company/shareholder relationships, so this falls under their directorate.
- yuhong 11y agoI wonder why non voting stock is not more commonly used.