Wednesday, November 20, 2013
Switzerland and its Vote on Executive Pay
I was always a firm believer on the idea that hard work pays off. It is frustrating to me, that the government is telling CEO's that they can't reward themselves for the hard work and great business that they are bringing in. The consequence of rewarding themselves because of their hard work, being jail time up to three years or to have to forfeit up to six years of their salary, is not right. Bringing in the text of peoples initiative into the Switzerland constitution did not agree with me. Giving shareholders voting rights with more power, but along with not threatening criminal sanctions was rejected and it is not surprising. I give great gratitude for Mr. Vasella, declining a severance package of seventy-six million dollars. That is a great deal of money and a great deal of money to give away. Much voting will be going on by shareholders and pension funds coming up. I never expected any outbreak to occur in such a prosperous society, but in a society where a taxpayer is due his money, it would be reasonable for such an outbreak to occur.
Subscribe to:
Post Comments (Atom)
I shared the same thoughts as I read this article. I bothers me that individuals have false sense of entitlements when they haven't earned something. The owners have made the company what it is and deserve the money that the company has been able to produce.
ReplyDeleteI think that government should not intervene with the private sector. Owners of the companies should dictate how they run the company, the weight of different votes, etc. I also think jail time is a little excessive as well as forfeiting salary. If someone does not agree with how the CEOS run the company, then they should not decide to work there. That in itself should lead to the company's demise without government intervention. CEOs have to do what is best fit for the company as a whole to see success, and pleasing their employees can be a part of the companies success.
ReplyDeleteLet's define some terms. CEO = chief executive officer, the person in charge of executing decisions at the top levels. A CEO is a type of employee, not a type of owern. A shareholder = an owner of stock. Stock = an ownership stake in a company. So, it is actually the CEO that is the employee, and the shareholder who are the owners.
ReplyDeleteAfter learning more on the components of this issue, I think that shareholders who own a majority of the company should have a say in what the CEO or executive gets paid. The smaller shareholders should not. Im still not for government intervention like you said, but some change needs to happen.
ReplyDeleteRegardless of whether there is a problem with people who aren't working trying to take money they haven't earned, I think it is important for there to be reason for CEO's taking massive bonuses and pensions to take pause. In order for a company to thrive there must be an agreement between executive and employee that the CEO will not take too much of the money before it reaches the employees. This builds loyalty and trust between employee and employer, and if the threat of workers leaving is not enough to stop CEOs then there should be some, preferably less extreme, method.
ReplyDeleteCouldn't agree more. There are steps that need to be taken to get rid of this issue, but I don't believe in a board determining executives' wages.
ReplyDelete