The Concept Of Executive Compensation

In “The Overpaid CEO” Susan Homberg and Mark Schmitt bring to attention how CEO pay in America is ridiculous in numbers as opposed to other parts of the world. Looking back, in the nineteen hundreds CEO pay was relativity average. As businesses and companies began to expand there was a demand for higher pay. Between 1978-2012 CEO pay increased by 875%! Many rules and regulations were put in to place to limit the pay of a CEO, such as the Securities Exchange Act that I will explain later on, regardless CEO pay kept getting higher and higher as many loopholes were found. Bonuses pay a large part in the salaries of CEOS’, as an effect CEOS’ tend to partake in risky behavior in order to score those big paychecks.

Stock options are another main concern and are based upon the performance of a company. A lot of companies are in a low return and low compensation which then caused bad business and it’s about 400 times that amount. I believe the government is trying to tighten down on excessive executive compensation with implementing salary caps. Executives are unrealistic with common life and way of living therefore; they do not take any consideration with the underdogs of the company or the world. The economy does have hope but it’s a long way from being stabilized once again.

Chief Executive Officer pay in the United States has risen dramatically. In the past three decades the salary of a CEO has risen significantly beyond what can be explained by variables such as firm, size, performance, and industry classification (Bebchuk & Grinstein, 2005). According to research, the CEO pay at the nation’s top 500 largest companies averages about $10.9 million a year. The CEOs are also receiving an additional $364,000 in perks. It was estimated that the average CEO makes 319 times more than the average worker in 2008 compared to a multiple of 42 in 1980((Anderson, Cavanagh, Kliner, & Stanton, 2005). CEO

Directors have awarded compensation packages that go well beyond what is required to attract and hold on to executives and have rewarded even poorly performing executives. These executive pay excesses come at the expense of shareholders as well as the company and its employees. Furthermore, a poorly designed executive compensation package can reward decisions that are not in the long-term interests of a company. Excessive CEO pay is essentially a corporate governance problem. When CEOs have too much power in the boardroom, they are able to extract what economists' call "economic rents" from shareholders (Economic rent is distinct from economic profit, which is the difference between a firm's revenues and the opportunity cost of its inputs). The board of directors is supposed to protect shareholder interests and minimize these costs. At approximately two-thirds of US companies, the CEO sits as the board's chair. When one single person serves as both chair and CEO, it is impossible to objectively monitor and evaluate his or her own performance.

Symbolism when an ordinary thing can have a hidden definition &/or stand for something else. In the

This report explores the issue of the pay that top executives make, and the reasons why they do. It also suggests improvements that can be made to make the system better. High Pay Seems Small When Compared To Company Profits Many companies pull in profits that are extremely high. When an employee of such a companies salary is compared to the amount of profit that the company earns, it starts to seem reasonable. It only makes sense that if the employee is directly responsible for the success of their company, then they deserve to get their payback. It seems ironic, but many salaries even look small once compared with a companies profits. Top Executives Are Under A Lot Of Pressure Being the CEO of a

Given the effect a CEO can have on a company's success, we can understand why their compensation packages

Executive compensation issue has always been on concern, especially after the shakeout of global economy in 2009, pushing concentration about this topic to the cusp. What exactly may be the criteria determining executive income? Peer group methodology, identifying companies that are reasonably similar to the subject company in terms of industry profile, size, and market capitalization (Institutional Shareholder Service Inc., 2014), is widely applied as a benchmark when companies make decisions about managers’ payoffs. According to ”S&P 1500 Peer Group Report 2014, most companies choose 11 to 20 firms per peer group. Targeted companies from same industry are mainly preferred.

During the economic crisis, the cost of giving compensation to executives is the relief capital could be spent elsewhere within the organization and not be handed down into their executive’s

Excessive top executive pay is viewed by the public as a direct linkage to economic inequality or disparity. Many opinions state that over the top pay stemmed from compensation trends and indicates corporate Board of Directors as business people earning similar salaries as top executives. Pozen and Kothari (2017) reported “More than 95% of the time, shareholders overwhelmingly approve the pay recommendations.” (Decoding CEO pay, para 2). Excessive pay distorts the views of the public and injures the trust of American workers. According to Pozen and Kothari (2017), companies, legislation, compensation committees, and stakeholders need to clearly articulate the basis of their decisions for setting excessive compensation.

In the introduction, Deber review statements made by Weber expounding social institutions. Weber mentions in the nineteenth century that religion and economy played an big-time role in how the society functioned. Deber was describing how economy and religion do not play the same role as they did in the nineteenth century. Deber uses the illustration of same sex marriage and attests that heterosexual marriage has changed social institution over the centuries. In the late twentieth and early twenty-first century that same sex marriage, single parents, and re-marriage is the institutional shift. In the excerpt, The Protestant Ethic and the Spirit of Capitalism, Weber describes how religion and the economy function in a society. Religion changed

This paper will discuss the reasons why CEOs are not being overpaid. It will apply the utilitarian ethical principle to many a few aspects to CEO compensation and whether or not it is justifiable for such pay. The paper will look at whether or not their performance is justifiable for the pay because they play such a big role in the livelihood of the company along with the principle agency theory and how it is being addressed for the benefit of the shareholders and others involved with the company, the supply and demand of the CEOs, and the paper will describe the comparison of other professions to help link the idea of CEOs being fairly compensated.

As a result of the current economic crises, many companies are experiencing massive financial losses. These companies are reducing salaries and cutting peoples’ jobs while executives are maintaining high compensations. Using tax payer’s money, the US Government is assisting these financially struggling companies through the Troubled Asset Relief Program (TARP). TARP was created to assist these companies to ultimately allow them to survive and prevent massive job loss. Tax payers are concerned about executives receiving a high and unjust compensation in comparison to other non-executives whom are suffering from layoffs and compensation cuts. Executive compensation is controlled by the

This paper looks at the opinions and issues involved within executive compensation. This is important because executive compensation is such an integral part of a company or organization’s functions. Executives are the ones tasked with making the decisions within an organization, and their pay can sometimes be linked to how well or how not well their decisions pan out. To look at these opinions, research and high quality analyses from various data sources were used. Some of these sources included the in-class textbook, “Compensation” by George Milkovich, Jerry Newman, and Barry Gerhart. While other sources used, included peer reviewed journals as preferred by the professor. All of these sources were used to show the relevance between executive compensation and compensation management as an entirety. The results are across the board; there are issues and opinions that clearly contradict each other and individuals take many different stances on the topic of executive compensation. The conclusion is that this will continue to be an ongoing and sensitive topic to discuss within organization structures and plenty more research and data will arise for individuals to gain further and deeper understanding of the complex nature of executive compensation.

The Bible, defined as a collection of sixty-six scriptures that compose the Old and New Testament. For a number of people, including catholics and religious officials, this holy script can be the final word between what is morally and religiously right and wrong. A biblical quotation, Radix malorum est cupiditas is Latin for avarice is the root of all evil. In the frame narrative, The Canterbury Tales, there is no limit to the use of religious and moral connections that the fictional characters present. The Wife of Bath and the Pardoner show their cupidinous for money through the prologues and tales. In the prologue told by the Wife of Bath, she uses the Bible to justify her actions to the other characters, as having multiple suitors is presented in the Bible. Her need to justify herself comes from the marriage of multiple wealthy decrepit men as each yielded an immense inheritance. This shows not only her justification of having remarried but her avidity for money. The Pardoner also references the Bible in his prologue to demonstrate his superiority when compared to the people he sells pardons and fake relics to as he admits his sin but takes the money of the guilt ridden people. The Pardoner’s main argument consists of simple yet intelligent logic, why would the people be buying the fraudulent items if they had not done anything for which they were necessary? His tale also references money, which leads to