CEO bonuses

sepusepu · Senior Member

CEO bonuses

abre les ojos · Guru

sepusepu wrote:

Is it fair to see CEO s making so much money excluding their regular pay.

sepu

Yes. If you are a CEO...

awmygawd · Guru

sepusepu wrote:

Is it fair to see CEO s making so much money excluding their regular pay.

sepu

That's where you're wrong. There's no such thing as 'regular pay' for directors, there's just 'pay', period. The way it's structured isn't as relevant as the final amount that actually goes out, you have to look at the whole package. A good example is with Steve Jobs from Apple Computer inc. His 'salary' last year was 1$, however, he also recieved a 'restricted stock award' worth $74,750,000, so you see, salary (or 'regular pay') figures can be red herrings when it comes to director's pay.

Whether it's fair or not is a different issue. Many of them (such as, in my opinion, Steve Jobs) deserve every cent, while others most certainly don't. I don't have a problem with high director's pay (in itself) as long as their talent and contribution is commensurate.

sepusepu · Senior Member

By regular pay i meant the whole package that they are entitled to. My question was on bonuses that vary every year depending on company performance. The CEO of Goldman and Sachs just got a record $53million bonus for the year 06. This excludes his stock options, benefits and other incentives.

Just to clarify what i was talking about.

Thanks for your opinions.

sepu

-- Edited by sepusepu at 20:56, 2006-12-22

awmygawd · Guru

sepusepu wrote:

By regular pay i meant the whole package that they are entitled to. My question was on bonuses that vary every year depending on company performance. The CEO of Goldman and Sachs just got a record $53million bonus for the year 06. This excludes his stock options, benefits and other incentives.

Just to clarify what i was talking about.

Thanks for your opinions.

sepu

-- Edited by sepusepu at 20:56, 2006-12-22

If the payment varies with performance, from the shareholder's perspective that's fine. In theory that would mean that the executive gets paid less when the company does poorly and vice versa. Not that it always works out that way. Even so, I wouldn't exclude the annual bonus from the 'whole package', especially in the case of Goldman Sachs, an investment bank. There is often good reason (psychological, tax, etc) to pay exec's by way of bonus (as opposed to salaries, etc), even where the final payments would be identical either way.

Is it fair? If you own the company and are financially better off because these exec's work for you, there probably isn't much to complain about. If you work for the company and it so happens that the reason it performs well is it's use of virtual slave labour, it's horribly unfair. If the company makes money by disrupting the lives of innocent people; unfair. Is it unfair per se? I don't think so. It all depends on who's talking.

-- Edited by awmygawd at 12:46, 2006-12-23

bingiza · Guru

awmygawd wrote:

Is it fair? If you own the company and are financially better off because these exec's work for you, there probably isn't much to complain about. If you work for the company and so happens that the reason it performs well is it's use of virtual slave labour, it's horribly unfair. If the company makes money by disrupting the lives of innocent people; unfair. Is it unfair per se? I don't think so. It all epends on who's talking.

-- Edited by awmygawd at 21:55, 2006-12-22

Can we take a malawian scenario, i dont think if the picture will be the same.

awmygawd · Guru

bingiza wrote:

Can we take a malawian scenario, i dont think if the picture will be the same.

There is no single picture, Malawian or otherwise. The point is, fairness of pay is relative. Unless you have in mind a single factor that is equally applicable across the whole of Malawi, It would be diffcult to say whether bonuses are unfair, period. It's more likely that there is a mix of circumstances where they are justified or unjustified to varying degrees.

-- Edited by awmygawd at 13:11, 2006-12-23

bingiza · Guru

awmygawd wrote:

There is no single picture, Malawian or otherwise. The point is, fairness of pay is relative. Unless you have in mind a single factor that is equally applicable across the whole of Malawi, It would be diffcult to say whether bonuses are unfair, period. It's more likely that there is a mix of circumstances where they are justified or unjustified to varying degrees.

-- Edited by awmygawd at 13:11, 2006-12-23

Fairness of pay basing on what?

CE's in malawi to my view are lazy bums who make their own contracts and have no interest over the welfare of junior staff, i think people should be paid according to what they contribute to the organisation not what post they hold. For instance a malawian company (am not at liberty to mention it) posted a loss in this ending year and the outlook for next year is bleek and no increament but the CE got his bonus (the staff didnt) and he will get his scheduled increament. I know we will blabber of a binding contract but what about those not on contract? Should they lose for the simple fact that they are not on contract. And what makes the company run is it not sound policy from the executive and hard work from the rest of the crew i wouldnt be surprised if the employees start a go slow.