Although I generally think most CEOs are overpaid, remember: they are legally accountable for the behavior of the organization. For example, David Drummond, who was Chief Legal Officer at Google (until it turned out he was impregnating people who reported to him) was convicted in a lawsuit in Italy, sentenced to prison, and there was a warrant for his arrest if he entered. This was over a video on a part of google that David had no real oversight on, where Google removed a video within only minutes of the issue being reported.
I figure legal responsibility is about $1-2M in pay right there.
The CEO also plays a critical role (with the CFO) in finalizing the earnings reports, with severe penalties for mistakes. They make strategic decisions that many employees aren't even aware of, that can have $billion+ repercussions for the company.
Taken all together, it's not completely surprising that a CEO of a trillion dollar company makes $10M/year (or receives stock of that value).
No, it's not truly meritocratic. I keep coming back to a lesson I was taught as a kid: life's not fair, but you can use your brain to make it a little less unfair.
How many other examples do you have? I've yet to see anyone or anything even close to legally accountable for their behavior. Corporations get caught doing things all the time, and the most I can see is a fine that is typically much smaller than the laws they broke.
There's no reason for the compensation between executives and workers to be so great. It's rigged and you can see it right here in this article.
>Taken all together, it's not completely surprising that a CEO of a trillion dollar company makes $10M/year (or receives stock of that value).
I mean, sure. a trillion dollar company, 10m dollar salary, that's not even 1 hundredth of a percent of the company.
Apparently the Mozilla foundation is around 2 billion in revenue a year. But how is that worth 70% of the above salary (I won't count stocks, it makes sense that if a company makes more money, shareholders make more money)? $we're already well beyond retirement levels of funding in a few years and they double it in 2 years.
I figure legal responsibility is about $1-2M in pay right there.
The CEO also plays a critical role (with the CFO) in finalizing the earnings reports, with severe penalties for mistakes. They make strategic decisions that many employees aren't even aware of, that can have $billion+ repercussions for the company.
Taken all together, it's not completely surprising that a CEO of a trillion dollar company makes $10M/year (or receives stock of that value).
No, it's not truly meritocratic. I keep coming back to a lesson I was taught as a kid: life's not fair, but you can use your brain to make it a little less unfair.