Jeffrey Pfeffer has written a provocative column on CEO pay. An excerpt:
Just as overinflated as executive salaries is the notion that CEOs can profoundly affect company performance. Years ago most top execs rose through the ranks and CEO positions were filled from within. The CEO-as-celebrity culture didn't exist.
Today the free-agency market for CEOs and searching outside for miracle workers have jacked up salaries but weakened the link between pay and performance. Don't believe me? Read the sports pages. Free agency in major-league baseball has led to escalating salaries for all players--but is the play any better? Hardly. The point is, free agency tends to escalate wages, regardless of performance.
No comments:
Post a Comment