3 ms·

There's a lot of room between 200k and 200M, and given that the company is laying people off and cutting costs, the CEO should share in that sacrifice.

• PeterisP 3y ago
  Layoffs aren't a sacrifice, it's the CEO acting against the interests of the ex-employees but in the interests of shareholders (which is his job) and for that they get amply compensated by the shareholders. Imposing a policy that if "the company is laying people off and cutting costs, the CEO should share in that sacrifice" is literally insane because it's counterproductive - it would explicitly motivate the CEO to avoid cutting costs and avoid laying people off (since that would cut their personal income), while shareholders want the exactly opposite thing, to motivate the CEO to be aggressive in cutting costs (including layoffs) whenever it allows to increase long-term profits, so any CEO compensation policy (which is set by the shareholders) should reflect that.
  • not2b 3y ago
    It is not necessarily in the interest of the shareholders if the compensation of top executives is so extreme as to starve a company of resources; this is especially the case because executives often only stay with a company a few years and are motivated to play games that produce short-term bumps in the stock price while harming long-term prospects (to pull this off the long term damage can't be completely obvious to analysts, but it often happens).