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C-suite compensation, especially stock-based, is often in part to ensure management loyalty to shareholders vs other things. Worker board membership means manag
by Ericson2314 3y ago
C-suite compensation, especially stock-based, is often in part to ensure management loyalty to shareholders vs other things. Worker board membership means management once again has competing loyalties, but now de jure. That means it is not worth it to the share holders to pay the extra "ransom compensation", in addition to workers probably outright being against it. I would thus expect C-suite compensation to go down.
- FrustratedMonky 3y ago"ensure management loyalty to shareholders" Everyone's pay is to keep them, isn't it? Nobody is loyal beyond being paid. Do CEO's really provide so much 'extra' benefit to justify the premium? Is their loyalty in particular worth paying so much for? I'm just not seeing how 'ransom' is needed. Isn't growing a healthy business supposed to be the goal for CEO and Board? And if employee owned, it is same. The only reason to pay the extra 'ransom' to be loyal to shareholders, is when they want the CEO to do things that are 'not' for the benefit of the company, but only to benefit shareholders, who can sell and exit.
- monknomo 3y agoI think the question is who is the business healthy for, and who is the c-suite and up loyal to? It is possible, and even likely, that a healthy business differs in some material ways for a CEO+board than its employees, though I also expect there are also overlaps
- Ericson2314 3y agoThe ways the stock price influences a business that already has gone public are subtle and not to be taken for granted