Progressive leaders such as Whole Foods’s John Mackey are capping their pay in order to lead by example. “The tremendous success of Whole Foods Market has provided me with far more money than I ever dreamed I’d have and far more than is necessary for either my financial security or personal happiness,” Mackey wrote in a letter to employees. “Beginning on January 1, 2007, my salary will be reduced to $1, and I will no longer take any other cash compensation.”
Jan. 1 has come and gone, and executive pay could well become an even bigger issue soon, even on the national stage. Earlier this week, an article in USA Today foreshadowed some possible changes to CEO payrolls.
Lawmakers in both houses of Congress plan to make laws affecting executive pay packages, and a new rule from the Securities and Exchange Commission is forcing companies to provide a simplified summary of top executives’ compensation in their public filings. Even President Bush weighed in on the subject last week in New York, exhorting corporate boards to tie CEOs’ salaries and bonuses to their success in improving companies and bringing value to shareholders.
It’s interesting that President Bush is discussing the issue — it indicates that concern about pay gaps might not follow party lines. That goes against conventional wisdom. What do you think?