It is largely random, and heavily influenced by culture. E.g. CEOs in different countries make vastly different salaries yet don't have noticeable difference in

It is largely random, and heavily influenced by culture. E.g. CEOs in different countries make vastly different salaries yet don't have noticeable difference in performance or outcomes. CEO salaries has more to do with political ideology of a country than market realities. It is no coincidence that the country were people have the most unrelenting belief in the magic powers of the individual, America, also pays their CEOs the highest. Also no coincidence it happened after the 80s philosophy of "greed is good". Research, logic, and reason simply doesn't support the myth of the CEO. But board members and CEOs themselves like to indulge in that myth.