Whenever some clueless line-toeing “executive” is asked to justify the absurd salaries that he and his peers vote one another, he usually wibbles on that you have to pay “the going rate” to attract the best talent or that huge “packages” are the only way to offset the risks inherent in working in today’s “entrepreneurial” management culture.
In the top ten of today’s Guardian Top 100 most influential figures in British media, three of the most talented and the only genuinely entrepreneurial members of that group—Steve Jobs, Sergey Brin, and Larry Page—each receive salaries of $1 per annum.
Executives rape their shareholders for the same reason that dogs lick their balls – because they can.
Yeah, but they’re principals.
But that is because they have assets (shares, share options) worth, literally, billions of dollars. A few million in salary foregone means nothing to them and taking a token salary seems like a nice gesture.
Er, that’s the point.
The reason they have assets is because they are real entrepreneurs who founded their respective companies—rather than time-servers claiming that status to justify their compensation—and the reason those assets are so large they can afford to forgo a salary is because they have made those companies successful through their own talent.
It’s the difference between a boy telling his mum that she should buy him a set of Tiger Woods™ golf clubs because he plays like Tiger Woods and a boy being given a set of Tiger Woods™ golf clubs because he is Tiger Woods.
Getting paid on results, not on inflated or inaccurate executive BS? good idea, it’s not so much the large salaries taht annoy me, it’s the guys who are paid them when they’ve sent the company nosediving since they came in, and then get a massive pay-off when they should be turfed out the door that really wind me up.
What you said basically.
Pooter has a point here.
Bosses make good bread.
Cause quite in itself, my dear,
To shoot the bastards dead.
Don’t tell us what their salaries are, tell us what their total remuneration is. It will run into millions, maybe tens of millions.
It is done via vehicles other than salary for tax reasons – ie they pay less that way.
[…] Further to my recent post about executive salaries, here’s an article from Tuesday about how the tech firms that pay their CEOs the most give the lowest returns to investors. […]
How do you determine what is an ‘absurd’ salary?
Paying someone a large sum of money to lose you a vast sum of money seems absurd to me, but, who knows, it could be a new paradigm.
What if you were expecting to lose an even vaster sum of money? Then the executive has arguably performed well, even if it doesn’t look that way to the public.
In Steve Jobs’s case, he doesn’t just have the assets as a result of founding the company; he was also given a huge number of stock options as part of his remuneration package as CEO. And they gave him a private jet, too. Oh, and one dollar.
I agree that giving CEOs shares instead of cash gives them better incentives, but it’s wrong to claim that Jobs has his shares as a result of founding Apple. Apple gave him at least ten million of them — they’re just salary under a different name.