5 ms·

Ah well, yes, but y'see, they also work 670 times harder, y'see

by slater 4y ago

chii 4y ago
Working harder doesn't mean you get paid more. The ceo being paid a lot doesn't imply they have to have worked harder to obtain it. The board determined the ceo pay , and the board represent the shareholders, who ultimately are the final arbiters of the value being generated by the ceo.
- Gibbon1 4y ago
  > and the board represent the shareholders The board represents only some shareholders.
  - moistly 4y ago
    And the board often delegates compensation decisions to a third party. Said third party is incentivized to rationalize a higher compensation for the executive class, because that best ensures that they’ll be hired to do so again in the future.
    - formerkrogemp 4y ago
      And the auditors are paid by the company that they audit.. For risk of material misstatement, not fraud. A fraudulent company can still pay an auditor a significant sum, and the auditor won't look for fraud, only material misstatement. It's the "audit expectations gap."
    - Gibbon1 4y ago
      Yeah friend worked for an executive compensation firm for a while. It was all about justifying increasing the CEO's compensation to match what other companies were paying. There is also the problem of the incestuous you scratch my back I scratch yours nature of board membership.
      - chii 4y ago
        > justifying increasing the CEO's compensation to match what other companies were paying. which is what market rate means right? If a good CEO is poached to a competitor, the company will lose out.
- klyrs 4y ago
  Most boards I've looked at are composed of people with C-level titles. While members of the board might not have a direct conflict of interest for a particular CEO, most have an interest in normalizing extreme CEO salaries.
- meatsauce 4y ago
  Let's be honest; most CEOs work smarter and lead these large companies to immense profitability. They, as leaders, are entitled to (in essence) a commission - a reward for the work they've done, the leadership, the right decisions, and pivoting necessary to realize opportunities. The "worker" doesn't and in many cases, can not do any of what I described. They are paid for a job at a fair market rate. To compare the two is to do two things. 1) display a willing ignorance of the dynamics and 2) telegraph a tired political whine.
credit_guy 4y ago
CEO's make very consequential decisions. 15 years ago Paul Graham declared Microsoft dead [1]. Today it is a 2 trillion dollar company, behind only Apple. How did that happen? 15 years ago Microsoft was the master of a technology that was already passee, the desktop OS. The new money-making technologies (search, social networks, internet commerce, smartphones) were dominated by other players (Google, Facebook, Amazon, Apple). They tried to compete (anybody remembers Zune?) but they just could not execute. Then they changed their CEO, and under Nadella they pivoted to cloud. Big time. So now they are one of the 3 big names in cloud (Amazon and Google being the other ones). Maybe there are other reason (Microsoft is an immensely complex company), but few could argue that Nadella had nothing to do with the turnaround. If he just worked as much as 670 regular engineers, then Microsoft would still be dying, if not already dead today. [1] http://www.paulgraham.com/microsoft.html http://www.paulgraham.com/microsoft.html
- al_borland 4y ago
  Exactly this. 670 people pointed in the wrong direction aren’t going to be effective. The turnaround of Apple under Jobs was another example. They went from 3 months away from bankruptcy to the most valuable company in the world. The value multiplier of a world class CEO is huge. They being said, some of them suck and should be forced to pay the company back for how much harm they have done. Like Léo Apotheker, who spent a brief period as the CEO of HP… selling off the recently acquired WebOS and almost selling off their PC division. I can’t help but ponder what might have been if he didn’t sell WebOS and they had a CEO that invested hard in mobile and integrations with the desktop. We might have another viable mobile platform. That one bad decision likely cost HP more than their entire staff salary.

Ah well, yes, but y'see, they also work 670 times harder, y'see

by slater 4y ago

Ah well, yes, but y'see, they also work 670 times harder, y'see

chii 4y ago

Working harder doesn't mean you get paid more. The ceo being paid a lot doesn't imply they have to have worked harder to obtain it. The board determined the ceo pay , and the board represent the shareholders, who ultimately are the final arbiters of the value being generated by the ceo.

Gibbon1 4y ago
> and the board represent the shareholders The board represents only some shareholders.
- moistly 4y ago
  And the board often delegates compensation decisions to a third party. Said third party is incentivized to rationalize a higher compensation for the executive class, because that best ensures that they’ll be hired to do so again in the future.
  - formerkrogemp 4y ago
    And the auditors are paid by the company that they audit.. For risk of material misstatement, not fraud. A fraudulent company can still pay an auditor a significant sum, and the auditor won't look for fraud, only material misstatement. It's the "audit expectations gap."
  - Gibbon1 4y ago
    Yeah friend worked for an executive compensation firm for a while. It was all about justifying increasing the CEO's compensation to match what other companies were paying. There is also the problem of the incestuous you scratch my back I scratch yours nature of board membership.
    - chii 4y ago
      > justifying increasing the CEO's compensation to match what other companies were paying. which is what market rate means right? If a good CEO is poached to a competitor, the company will lose out.
klyrs 4y ago
Most boards I've looked at are composed of people with C-level titles. While members of the board might not have a direct conflict of interest for a particular CEO, most have an interest in normalizing extreme CEO salaries.
meatsauce 4y ago
Let's be honest; most CEOs work smarter and lead these large companies to immense profitability. They, as leaders, are entitled to (in essence) a commission - a reward for the work they've done, the leadership, the right decisions, and pivoting necessary to realize opportunities. The "worker" doesn't and in many cases, can not do any of what I described. They are paid for a job at a fair market rate. To compare the two is to do two things. 1) display a willing ignorance of the dynamics and 2) telegraph a tired political whine.

credit_guy 4y ago

CEO's make very consequential decisions. 15 years ago Paul Graham declared Microsoft dead [1]. Today it is a 2 trillion dollar company, behind only Apple. How did that happen? 15 years ago Microsoft was the master of a technology that was already passee, the desktop OS. The new money-making technologies (search, social networks, internet commerce, smartphones) were dominated by other players (Google, Facebook, Amazon, Apple). They tried to compete (anybody remembers Zune?) but they just could not execute. Then they changed their CEO, and under Nadella they pivoted to cloud. Big time. So now they are one of the 3 big names in cloud (Amazon and Google being the other ones). Maybe there are other reason (Microsoft is an immensely complex company), but few could argue that Nadella had nothing to do with the turnaround. If he just worked as much as 670 regular engineers, then Microsoft would still be dying, if not already dead today. [1] http://www.paulgraham.com/microsoft.html http://www.paulgraham.com/microsoft.html

al_borland 4y ago
Exactly this. 670 people pointed in the wrong direction aren’t going to be effective. The turnaround of Apple under Jobs was another example. They went from 3 months away from bankruptcy to the most valuable company in the world. The value multiplier of a world class CEO is huge. They being said, some of them suck and should be forced to pay the company back for how much harm they have done. Like Léo Apotheker, who spent a brief period as the CEO of HP… selling off the recently acquired WebOS and almost selling off their PC division. I can’t help but ponder what might have been if he didn’t sell WebOS and they had a CEO that invested hard in mobile and integrations with the desktop. We might have another viable mobile platform. That one bad decision likely cost HP more than their entire staff salary.