Sky-High CEO Pay Is Bad Business Analysis

523 Words2 Pages

It is unethical for CEOs to be paid absurdly high amounts of money. How much a CEO actually impacts a company’s value is debatable. To make sure corporations are getting a good return on their investment they could give a base salary plus offer CEOs stock options. The positive is that CEOs would be partially compensated based on actual performance. The negative is one may create a situation where CEOs feel the need to do unethical things to guarantee a positive return. Either way it is difficult to justify paying large amounts of money for someone just to come to your corporation with no guarantee of their success.
Once a CEO is financially secure other benefits can be used to increase their satisfaction (Why Sky-High CEO Pay is Bad Business). I think the idea of paying upper management high amounts of money and expecting them to be happy and …show more content…

Upper management can have their financial needs met without paying them 300 times more than the average employee (Why Sky-High CEO Pay is Bad Business). Not only is that potentially a poor return on the business’s investment but employees will see the high pay and question whether they are at the right place. It could also impact their work performance because there is no need to work as hard as you can so some manager can get an even bigger bonus (Influencing Employee Motivation).
I feel that conscious capitalism is more sustainable than relying on the market to determine upper management wages. The wage gap has widened continually for decades and it’s wider in the United States than other parts of the world. Outside influences like tax breaks may impact how upper management is compensated. Instead of relying on the government to tax high income earners, corporation can recognize that they can still recruit talented leaders and have success without giving unreasonably high pay to CEOs (Motivation in the Workplace, Practical Techniques for

Open Document