What Is Your Company's CEO Worth?

Notice I said, what is your company's CEO worth? Not, what does your company's CEO get paid?

Scott Decarlo wrote an article Top Paid CEO's showing the salaries (including stock options - exercised - and all other benefits) of several CEO's of publicly traded companies.  The article mentions:  1)  Oracle chief Larry J. Ellison - $183 Million (REMINDER, THIS IS ANNUAL, IN OTHER WORDS, EARNINGS FOR ONE YEAR that we are referring to here) 2)  Frederic M. Poses of Trane - $127 Million 3) Aubrey K. McClendon of Chesapeake Energy - $117 Million 4) Angelo R. Mozilo of Countrywide Financial - $103 Million 5) Howard D. Schultz of Starbucks - $99 Million

Now this is one of the problems that I have with these facts, people blame the CEO for making these outrageous salaries when in fact nobody but the Board of Directors is to blame.  They are the ones that make the choices for the CEO's and they are the ones that offer the packages to them.  The CEO's are not to blame, hell if someone offered me a hundred million dollars to run a company that I knew absolutely nothing about, I'd take it.  Why not?  There are no repercussions if I fail.  What ruin my reputation?  I may not be able to get another CEO position?  What a shame!  I'll be sitting on some island somewhere drinking a Manhattan after I've laughed all the way to the bank.  In all seriousness, I'd like to think I would take the moral high road, but "they" say, everyone has a price.

So you see, it is not the CEO's that are idiots, they are geniuses!  The companies' Board of Directors are the idiots!  They bring the CEO on board and say, this is what you get paid even if you do nothing, make things worse, or heaven forbid make the company a huge success.

I worked for a company that paid a CEO millions and the company was in worse shape when he left than when he came on board to "turn things around".  To this day I hear people refer to him as the idiot that created the downfall of that company.  But, is he really?  He's probably sitting on a mountain top somewhere enjoying the view from his multi million dollar home, so is he really the idiot?

The sad part of all of this is the "peons" (I was one for YEARS) in the corporate world have no input whatsoever about these decisions.  The board of directors make the decisions and the rest of the company is forced to accept it or move on.  But how many of us move on?  Not many.  The majority of us stay and complain about the incompetent idiot, but yet continue to draw that corporate pay check UNTIL the new CEO brings in their own leaders (and I use that term lightly).  At which point the new leaders begin to "clean house" by replacing us (the true loyalist) with people that they know that could care less about the company as this is just another stepping stone for them.

To be continued...

Source:  Top Paid CEO's by Scott Decarlo