Executive Compensation: The Critique and the Ideal.
Nandamuri, Purna Prabhakar
Executive Compensation: The Critique and the Ideal. - 33-48 p. - IUP Journal of Corporate Governance. .
Consequent to the subtle and dynamic business environment and recent corporate failures, the focus shifts towards the emerging challenges for the social, moral and ethical objectives of corporate governance around the world. Executive compensation has emerged as the most contentious issue during the current decade. The exorbitant compensation packages of the senior managers and the resultant extensive gap between the remunerations of the senior managers and the employees and staff at the middle and lower levels has been the focal point for bitter comments from various sections of the society. Corporate boards seem to think that large pay packages stem from fierce competition for talented managers capable of leading global organizations through the turbulent environment. But critics argue that executives get rich at the expense of shareholders and other workers. However, the reality is that the average ratio of CEO pay to average worker pay was 335 times in 2015 compared to 40 times in the 1980s, making a mockery of the ethical ideals, such as Plato's, that no person should be worth more than five times of another. In this background, the present paper attempts to analyze the issue of executive compensation in the light of the ethical ideals. [ABSTRACT FROM AUTHOR]
Executive compensation Corporate governance Corporate directors Business planning
Executive Compensation: The Critique and the Ideal. - 33-48 p. - IUP Journal of Corporate Governance. .
Consequent to the subtle and dynamic business environment and recent corporate failures, the focus shifts towards the emerging challenges for the social, moral and ethical objectives of corporate governance around the world. Executive compensation has emerged as the most contentious issue during the current decade. The exorbitant compensation packages of the senior managers and the resultant extensive gap between the remunerations of the senior managers and the employees and staff at the middle and lower levels has been the focal point for bitter comments from various sections of the society. Corporate boards seem to think that large pay packages stem from fierce competition for talented managers capable of leading global organizations through the turbulent environment. But critics argue that executives get rich at the expense of shareholders and other workers. However, the reality is that the average ratio of CEO pay to average worker pay was 335 times in 2015 compared to 40 times in the 1980s, making a mockery of the ethical ideals, such as Plato's, that no person should be worth more than five times of another. In this background, the present paper attempts to analyze the issue of executive compensation in the light of the ethical ideals. [ABSTRACT FROM AUTHOR]
Executive compensation Corporate governance Corporate directors Business planning