CEOs' pay comes under much scrutiny and the public reaction is generally negative. Historically, the base pay for CEOs has dropped from 60% of their total compensation in 1960 to about 20% today. During this same time, long-term incentives (stock options) have risen from 15% to about 66%.
- Has the change in the composition of CEO pay been effective in increasing company performance?
- Do you think there are alternatives that might work better for long-term company growth and profitability? If so, provide an example of such an alternative.
It is my belief that the change in the composition of CEO pay has not been effective in increasing company performance, due to the fact that even with the change in the composition of CEO pay, and the tremendous salaries ...