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CEO Pay: Do They Merit The Multi-Millions?

By on November 14, 2011

For a year that has the world’s economy dangling between chaos and near total collapse, we can’t ignore how the decision makers have fared.  With the global financial meltdown, fragile European economy, Africa’s leaping ride, CEOs are still taking huge pay and god-knows-why bonuses while the risk-averse boards nod their heads in a bid to secure their own pay.

In this age of the enlightened enterprise, CEOs hardly take a second thought at the fate of workers who have seen their paycheck slashed and jobs disappeared. The trend globally is that CEOs job positions remain immune from all sorts of downsizing and rightsizing. While a few have shared the pain, others swim in the luxury of huge bonuses, stock grants, increasing base salaries, hottest vacation spots and company’s jets.

These risk-averse boards are undermining the opportunity inherent in innovation and the creation of profitable non-existent market. We are seeing more CEOs hide under the global economic situation to mask their mediocrity. For our market, nothing seems different as even Sansui’s bites have not deterred these guys from making the needed positive changes. It seems business as usual.

The implication for our market is the long term cost. As Africa and the Asian market show the way forward in economic growth, CEOs might have to battle with perception of inequity which can damage their companies’ reputation. The best we can do now is to ensure a long focus that satisfies employees pay with fairness.

Also, our market with huge supply of manpower (although with a few hot talent pool) and mild demand, we might consider this illogical. The hot chase for these talents won’t stop. These talents who have seen how their colleagues were ill-treated are sure to react negatively. A talent drain might just be inevitable.

It will be wise to look at this critically as the economy stabilizes. Chances are that corporate leaders who put themselves first will likely see talents look elsewhere. It is for this reason that protests like those of Wall Street have thrived.

As this inequity continues even with workers performance, paychecks have remained stagnant. The threat of offloading staffs remains high as boards look for where to shore up shareholders value. Outsourcing thrives and has come handy here.

All this marks CEOs and their boards’ lack of creativity. Let’s look at other ways than offloading our strategic assets. We have to fund R&D and keep an eye on results of research with the potential to grow the company’s bottom-line, no matter how risky it seems. For those companies that sustaining advertising creatively and fund R&D strategically are sure to benefit from the economy’s rebound. Some CEOs as it seems don’t deserve these huge paycheck and other benefits. Let the pain be shared.