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>From time to time, a CEO will have to choose between increasing employee compensation and benefits or increasing profits or dividends. The CEO works with emplo
by bussierem 9y ago
>From time to time, a CEO will have to choose between increasing employee compensation and benefits or increasing profits or dividends. The CEO works with employees all the time and most normal human beings would naturally tend to side with the employees because they're the ones that are working hard to generate the profits that the shareholders receive.
Do we live in the same world? In all seriousness, not meaning to be a jerk - this is not how corporations or CEOs think. They don't "work with the employees all the time". They don't choose employee compensation/benefits over increasing profits. We're lucky that they _sometimes_ choose "minimizing deaths" over profit, and even that track record is spotty at best.
- elihu 9y agoWhat I meant by "work with" is that CEOs work in proximity to and interact with employees pretty much every work day. I didn't mean to imply that their interests were aligned. I assume most CEOs don't talk to their board of directors every day. Most normal people will empathize with and want to please the people they work with to achieve some common goal (i.e. create a good product, grow the business, and beat their competitors). To the stockholders, that would be an undesirable trait, and so the board of directors gives the CEO stock options to encourage the CEO's self-interest to override his or her innate desire (if it exists) to treat employees well at the expense of profits and dividends.