Activision and EA CEOs Appear on List of "Most Overpaid" in the US

So let me get this straight, if anyone of you would be a ceo , you would all turn down these comp packs? Be honest now..

I fail to see what that has to do with anything...but sure, I'd take it the money.
 
Saying someone is "overpaid" implies you understand all the requirements and duties of the job and their ability to perform it. I don't see how the people that wrote the article, or anybody here, can claim that knowledge. CEOs are paid large sums of money for the same reason professional athletes are: because they are the rare individual that can do that job better than most of the people on the planet. That rarity, plus the perceived value (to the company, team, organization) is what drives those compensation packages, and in turn, is what partially drives those people to become the best at what they do. Saying out of hand that they are "overpaid' is just rank envy and class warfare.

LOL, no. Though I knew someone was going to post that particular screed. If these people are so elite and talented, why do they all need golden parachutes? Because the truth is that they're most just lucky sociopaths.

This isn't an issue of supply and demand, but of ineffective corporate governance.
 
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Capitalism works very well with appropriate, effective regulation. Unfortunately, our government has been bought and our regulatory bodies have been captured, so now it's just a matter of time until the national debt eats us alive. Meanwhile, the ultra rich will continue to loot right up until it's time to sail away in their super yachts.

Welcome to the second Gilded Age.
 
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LOL, no. Though I knew someone was going to post that particular screed. If these people are so elite and talented, why do they all need golden parachutes? Because the truth is that they're most just lucky sociopaths.

This isn't an issue of supply and demand, but of ineffective corporate governance.

Well no, you overlook their skills and say they're lucky sociopaths? CEO's deal with a magnitude of orders more shit than your rank and file employee. The entire company and its employees benefit or lose based on the ceo's decisions. Granted, they have help, but that's still a tone of pressure and responsibility.
As far as golden parachutes are concerned, they are a standard for top level execs. Do I think they're lucky sob's? Sure, but I don't hate them for getting that deal. Good for them , and all the others that can manage to command that sort of cash. If I hope to ever have a chance at something even remotely similar, I wouldn't think twice about doing the same damn thing as they have.
 
Well no, you overlook their skills and say they're lucky sociopaths? CEO's deal with a magnitude of orders more shit than your rank and file employee. The entire company and its employees benefit or lose based on the ceo's decisions. Granted, they have help, but that's still a tone of pressure and responsibility.
As far as golden parachutes are concerned, they are a standard for top level execs. Do I think they're lucky sob's? Sure, but I don't hate them for getting that deal. Good for them , and all the others that can manage to command that sort of cash. If I hope to ever have a chance at something even remotely similar, I wouldn't think twice about doing the same damn thing as they have.

You are a sociopath if you actually believe the CEOs of EA and Activision are doing a good job and deserve the current salaries they are receiving for what they are doing.
 
You are a sociopath if you actually believe the CEOs of EA and Activision are doing a good job and deserve the current salaries they are receiving for what they are doing.
Deserve?
Well, I do know that nobody here is in any position to say what another 'deserves'.
Considering that both are still employed, I'd say their respective Boards and shareholders are not unsatisfied.

This may come as a shock to you, but your opinion does not matter.
 
I think the idea is if a company is giving its CEO record pay in a time of record profits and then laying off hundreds of workers who helped make them the profit, then the more this sort of thing happens, the more it makes people question if this is such a good system in the first place.

A rising tide lifts all boats.
 
LOL its hilarious when you I see people come out and justify golden parachutes. Capitalism is great but go read up on how things changed since the 1980s. There are some companies that share bonuses with employees at times. But you don't see many. The system changed from lot of profit sharing with employees to lot of profit sharing with share holders. Just read up on it. Where pensions and bonuses became worst and worst since then and CEOs and shareholders got most of the profits. it's just how it is. No one is saying CEOs shouldn't get paid but if the system was as before where there was bonuses and profit sharing with employess you would see middle class lifted up.
 
Whether or not people agree or disagree that CEO's make too much money is irrelevant, and everyone that is saying the government should step in really have zero clue what they are advocating for.

Just like star professional sports players who are faces of their sports getting $300 million dollar contracts to bring their talents to a specific team, CEOs are faces of their respective companies, making decisions that steer directions of multi-million and multi-billion dollar corporate entities. Just as owners and ownership groups make the decision on what they are willing to pay said player for their talents, so too are board of directors. You want one of the best CEO/business leaders out there? You are going to have to pay to entice them away from where they are now.

There's no corporate draft every year where all of the corporations, organizations, for and not for profit, get together and see who is coming out of college ready to helm an entire company with zero real world experience. No one in their right mind pays someone with no real experience to helm a company...that would be idiotic. You are paying people who have vision, who have spent years in the workforce, who have experience leading people and making decisions that affect thousands upon thousands of people. I would wager (and I am not a betting man) that the VAST and overwhelming majority of folks that criticize what a CEO makes have ZERO real understanding of what it actually takes to be a CEO. To have a vision for an entire organization and to be able to have everyone buy into that vision. Spend your days going in 50 different directions, to have a non stop barrage of people within and outside of your organization vying for your attention. Non stop travelling. Non stop meetings and prepping for meetings. You can't focus on X and just be good at X like a lot of folks enjoy in their day to day work lives. No, you have to have an understanding of all aspects of your business and how they all operate together as cogs in a machine. But not just what works IN your company, but how your company interacts with other companies or the governments in the countries which you operate in (and in this day and age, that's usually several different countries each with their own laws, cultures, and ways of conducting business. Listening to everyone, upper management, middle management, assessing their abilities to do their jobs and lead their respective divisions. It's exhausting. Hell I am tired of typing...but I could keep going.

CEO's are not figureheads.

I see very few people bemoaning how much top athletes in their sports vs how much the base salary is, or what the guy on the practice squad is making. Why should one guy make $25 million a year, when the guy 50 feet to his or her left is making $750K? We should do something about that...either top players cede their overwhelming disparity in earnings to everyone else on their team, or we should have the government make a rule and force those evil greedy scumbags to give everyone their fair share.

It's crazy to think about how skewed peoples perspectives have become, along with the entitlement attitude that is so prevalent these days. People read the above and think "Yeah, that is totally not fair, we should do something to make it more fair." When in fact you should do nothing...it's none of your business. If the company or sports team want's to do that, then they should be able to do that. If it's not sustainable and the company or team goes under, then it goes under. No one is forcing employees or players to work/play for their organizations...players don't have to sign the contracts put in front of them, and employees are free to find another job and leave the same day (though two weeks is polite). Heck, if you even pay casual attention to sports you know that in spite of signing long term commitments, players often times refuse to show up, refuse to play, demand trades, etc....so they are by no means locked in just because they signed a contract.

A lot of this is pure jealousy. There is a large wealth disparity between myself and pretty much every CEO out there...but what business is it of mine that they make more than me. I need to focus on how I can achieve more wealth (if I want to), rather than figuring out (or using the .gov) a way to limit what everyone else makes.
 
Whether or not people agree or disagree that CEO's make too much money is irrelevant, and everyone that is saying the government should step in really have zero clue what they are advocating for.

Just like star professional sports players who are faces of their sports getting $300 million dollar contracts to bring their talents to a specific team, CEOs are faces of their respective companies, making decisions that steer directions of multi-million and multi-billion dollar corporate entities. Just as owners and ownership groups make the decision on what they are willing to pay said player for their talents, so too are board of directors. You want one of the best CEO/business leaders out there? You are going to have to pay to entice them away from where they are now.

There's no corporate draft every year where all of the corporations, organizations, for and not for profit, get together and see who is coming out of college ready to helm an entire company with zero real world experience. No one in their right mind pays someone with no real experience to helm a company...that would be idiotic. You are paying people who have vision, who have spent years in the workforce, who have experience leading people and making decisions that affect thousands upon thousands of people. I would wager (and I am not a betting man) that the VAST and overwhelming majority of folks that criticize what a CEO makes have ZERO real understanding of what it actually takes to be a CEO. To have a vision for an entire organization and to be able to have everyone buy into that vision. Spend your days going in 50 different directions, to have a non stop barrage of people within and outside of your organization vying for your attention. Non stop travelling. Non stop meetings and prepping for meetings. You can't focus on X and just be good at X like a lot of folks enjoy in their day to day work lives. No, you have to have an understanding of all aspects of your business and how they all operate together as cogs in a machine. But not just what works IN your company, but how your company interacts with other companies or the governments in the countries which you operate in (and in this day and age, that's usually several different countries each with their own laws, cultures, and ways of conducting business. Listening to everyone, upper management, middle management, assessing their abilities to do their jobs and lead their respective divisions. It's exhausting. Hell I am tired of typing...but I could keep going.

CEO's are not figureheads.

I see very few people bemoaning how much top athletes in their sports vs how much the base salary is, or what the guy on the practice squad is making. Why should one guy make $25 million a year, when the guy 50 feet to his or her left is making $750K? We should do something about that...either top players cede their overwhelming disparity in earnings to everyone else on their team, or we should have the government make a rule and force those evil greedy scumbags to give everyone their fair share.

It's crazy to think about how skewed peoples perspectives have become, along with the entitlement attitude that is so prevalent these days. People read the above and think "Yeah, that is totally not fair, we should do something to make it more fair." When in fact you should do nothing...it's none of your business. If the company or sports team want's to do that, then they should be able to do that. If it's not sustainable and the company or team goes under, then it goes under. No one is forcing employees or players to work/play for their organizations...players don't have to sign the contracts put in front of them, and employees are free to find another job and leave the same day (though two weeks is polite). Heck, if you even pay casual attention to sports you know that in spite of signing long term commitments, players often times refuse to show up, refuse to play, demand trades, etc....so they are by no means locked in just because they signed a contract.

A lot of this is pure jealousy. There is a large wealth disparity between myself and pretty much every CEO out there...but what business is it of mine that they make more than me. I need to focus on how I can achieve more wealth (if I want to), rather than figuring out (or using the .gov) a way to limit what everyone else makes.


That is a base less argument comparing CEOs to atheletes. Athletes drive revenue, energize fanbase and drive sales. People don't line up to buy CEO jersesys or drive sell out crowds to see them. Its like comparing apples to oranges. Teams earn the money back, they are not just overpaying them.

There will always be dispartiy between our pay and ceo pay. Heck I will never complain about that. But when you look at how pensions and other benefits used to be. I saw people that worked since the 70s and 80s retire with over a million dollar lump sum payments. And now? Good luck even coming close to that. Now it goes all to the top and share holders. You may not have any idea how good the retirement and pension plans used to be where employees benefited from profits but it changed to shareholders instead.

I am sure they could do alot better for employees and still pay millions and millions to CEOs.
 
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That is a base less argument comparing CEOs to atheletes. Athletes drive revenue, energize fanbase and drive sales. People don't line up to buy CEO jersesys or drive sell out crowds to see them. Its like comparing apples to oranges. Teams earn the money back, they are not just throwing money away.

Just because you say it is, doesn't make it baseless.

Other business may choose to align themselves with what my business is doing, and chose to direct their operations to become part of my ecosystem, or chose to support it in other ways based on what I say or do as CEO. Other CEOs or business groups may actually chose to actively compete against me based on what I say. CEO's absolutely drive folks to be "fans" of their organizations, and it doesn't result in a measly $85 jersey purchase.

Are you watching what going on, and has been going on with Musk?

Quite honestly, your answer speaks more to what you don't understand and know about the upper echelons of management, than what you do know.

I am all for taking care of your employees, and people need to understand that a business IS its employees. However that really doesn't change anything with regards to what I have said.
 
Whether or not people agree or disagree that CEO's make too much money is irrelevant, and everyone that is saying the government should step in really have zero clue what they are advocating for.

Just like star professional sports players who are faces of their sports getting $300 million dollar contracts to bring their talents to a specific team, CEOs are faces of their respective companies, making decisions that steer directions of multi-million and multi-billion dollar corporate entities. Just as owners and ownership groups make the decision on what they are willing to pay said player for their talents, so too are board of directors. You want one of the best CEO/business leaders out there? You are going to have to pay to entice them away from where they are now.

There's no corporate draft every year where all of the corporations, organizations, for and not for profit, get together and see who is coming out of college ready to helm an entire company with zero real world experience. No one in their right mind pays someone with no real experience to helm a company...that would be idiotic. You are paying people who have vision, who have spent years in the workforce, who have experience leading people and making decisions that affect thousands upon thousands of people. I would wager (and I am not a betting man) that the VAST and overwhelming majority of folks that criticize what a CEO makes have ZERO real understanding of what it actually takes to be a CEO. To have a vision for an entire organization and to be able to have everyone buy into that vision. Spend your days going in 50 different directions, to have a non stop barrage of people within and outside of your organization vying for your attention. Non stop travelling. Non stop meetings and prepping for meetings. You can't focus on X and just be good at X like a lot of folks enjoy in their day to day work lives. No, you have to have an understanding of all aspects of your business and how they all operate together as cogs in a machine. But not just what works IN your company, but how your company interacts with other companies or the governments in the countries which you operate in (and in this day and age, that's usually several different countries each with their own laws, cultures, and ways of conducting business. Listening to everyone, upper management, middle management, assessing their abilities to do their jobs and lead their respective divisions. It's exhausting. Hell I am tired of typing...but I could keep going.

CEO's are not figureheads.

I see very few people bemoaning how much top athletes in their sports vs how much the base salary is, or what the guy on the practice squad is making. Why should one guy make $25 million a year, when the guy 50 feet to his or her left is making $750K? We should do something about that...either top players cede their overwhelming disparity in earnings to everyone else on their team, or we should have the government make a rule and force those evil greedy scumbags to give everyone their fair share.

It's crazy to think about how skewed peoples perspectives have become, along with the entitlement attitude that is so prevalent these days. People read the above and think "Yeah, that is totally not fair, we should do something to make it more fair." When in fact you should do nothing...it's none of your business. If the company or sports team want's to do that, then they should be able to do that. If it's not sustainable and the company or team goes under, then it goes under. No one is forcing employees or players to work/play for their organizations...players don't have to sign the contracts put in front of them, and employees are free to find another job and leave the same day (though two weeks is polite). Heck, if you even pay casual attention to sports you know that in spite of signing long term commitments, players often times refuse to show up, refuse to play, demand trades, etc....so they are by no means locked in just because they signed a contract.

A lot of this is pure jealousy. There is a large wealth disparity between myself and pretty much every CEO out there...but what business is it of mine that they make more than me. I need to focus on how I can achieve more wealth (if I want to), rather than figuring out (or using the .gov) a way to limit what everyone else makes.
I can't speak for everyone else here, but I think it's not about people making tons of money so much as at what cost. Even if you ignore the larger picture, in just the microcosm of the company, their success is coming at the cost of hundreds of jobs that directly make them profitable. A company with a stable long term focus would use record profits to reinvest and keep people working on more projects to be more diversified and prepared for what the future brings. A short term focus would fire loads of people, use the income for stock buybacks to have record quarters for investors, even if that means hollowing out long term stability. Investing like there's no tomorrow is part of what got us into the 2008 crash. While Activision isn't big enough to crash the economy, the behavior they're helping to normalize almost certainly will in other sectors of the economy.

Maybe I'm missing how record top-heavy profits leading to record layoffs is a good thing and a sign of a healthy, stable company, but I'm not seeing how.
 
I will also add that I used the sports figure not as a direct correlation to their respective jobs and responsibilities within an organization, but more so to highlight the fact that they are paid a great deal of money to do something that most people attribute to "just playing a game." When you break it down to what some of these girls and guys make per at bat, or per quarter of play it's pretty crazy when compared to what the guy sweeping the stands makes after the game. He works for the same organization as the players, and if he and every other member of the clean up crew didn't do their jobs people would be hesitant to show up to the stadium to support that player whose jersey they purchased. Not many places would sell out, if when you got to the stadium there were beer cans and paper trays everywhere.

That being said, no one is coming to the stadium on game day because of Phil the custodian, or Jim Bob the groundskeeper. Nor are they there for Judy in concessions. Their respective jobs are important, but they are getting a fraction of what the guy driving people to the stadium is getting. I think that's fair.
 
I can't speak for everyone else here, but I think it's not about people making tons of money so much as at what cost. Even if you ignore the larger picture, in just the microcosm of the company, their success is coming at the cost of hundreds of jobs that directly make them profitable. A company with a stable long term focus would use record profits to reinvest and keep people working on more projects to be more diversified and prepared for what the future brings. A short term focus would fire loads of people, use the income for stock buybacks to have record quarters for investors, even if that means hollowing out long term stability. Investing like there's no tomorrow is part of what got us into the 2008 crash. While Activision isn't big enough to crash the economy, the behavior they're helping to normalize almost certainly will in other sectors of the economy.

Maybe I'm missing how record top-heavy profits leading to record layoffs is a good thing and a sign of a healthy, stable company, but I'm not seeing how.

You are missing that these companies have to compete with other companies for talented CEOs. The companies may not want to, and the shareholders may not want to, but getting someone that has experience leading entire organizations means you are targeting a small group of individuals. They are often already employed doing the same thing at another organization, maybe even a competitor, and you have to lure them to the top of your organization somehow...just as sports teams lure the top players to their teams via large contracts with lots of bells and whistles. Other teams are trying to get those players, and while there a hundreds of guys in MLB that can hit the ball, only a few have demonstrated an ability to do so at a high level. You aren't going to go pay the guy with the .210 batting average the same thing that the guy getting the 300 million contract is getting, but then, you don't expect the guy batting .210 to do the same thing at the same level. You expect the big contract guy to drive ticket sales, drive in runs, make other people on the team better, pull in other top prospects who want to be a part of what you have going on.

It's really quite complicated in both cases, and I don't think you can simplify the argument down and still have a conversation or discussion that really makes sense.

Conflating CEO pay with the health of an organization isn't going to correlate as unfair as that is...and I hope that they never correlate despite what some folks want. "It's not fair", doesn't factor into the equation at all.

You have a successful company whose CEO is paid a lot of money

You have an unsuccessful company whose CEO is paid a lot of money

You have an unsuccessful company who is looking for a CEO to turn their company around...do they hire the guy for $100K who has no experience, or do they hire the guy that has experience and wants $15mil. How do you entice someone to captain a sinking ship? Just one example out of many. And again...it's complicated. Should the company pay the guy a $15 million pay out when they close their doors and everyone else in the company walks out with their hands in their pockets? Yeah that doesn't seem fair, but those employees could have left when they brought the guy on.

I am all for performance based pay...I encourage that when I can. Let's change things a bit..how many teachers do you know that would be willing to base their salary on the performance of their students? Hey when you are an adult working in corporate America, you can leave if you think the company doesn't have your best interests at heart. Students get the teacher they are given, no real choice to go to another teacher or class, and their performance in that class could determine their overall GPA, their understanding of that material on standardized testing, what school they get into, etc. So why can't we hold teachers accountable to their students performance?

Personally, I think private equity firms debt loading businesses then filing for bankruptcy or closing the doors killing hundreds of jobs is FAR bigger of a problem than what a CEO makes. If you aren't familiar with the tactic of debt loading, go do some reading, it'll piss you off and you're anger will be focused at groups that deserve it.
 
I can't speak for everyone else here, but I think it's not about people making tons of money so much as at what cost. Even if you ignore the larger picture, in just the microcosm of the company, their success is coming at the cost of hundreds of jobs that directly make them profitable. A company with a stable long term focus would use record profits to reinvest and keep people working on more projects to be more diversified and prepared for what the future brings. A short term focus would fire loads of people, use the income for stock buybacks to have record quarters for investors, even if that means hollowing out long term stability. Investing like there's no tomorrow is part of what got us into the 2008 crash. While Activision isn't big enough to crash the economy, the behavior they're helping to normalize almost certainly will in other sectors of the economy.

Maybe I'm missing how record top-heavy profits leading to record layoffs is a good thing and a sign of a healthy, stable company, but I'm not seeing how.

So you know better? You're sure starting to sound like that guy in the stockroom who knows it all and thinks CEO's sit on their asses all day drinking the tears of their employees and smoking cigars wrapped in 1,000 dollar bills.

Protip: If a company was doing something that negatively impacted what makes them profitable...they would alter said behavior if in any way possible. CEO's are earning a lot of money because they're often generating a lot of profit. If a company is a short-sighted as you suggest, it would not likely remain in business long.
 
Students get the teacher they are given, no real choice to go to another teacher or class, and their performance in that class could determine their overall GPA, their understanding of that material on standardized testing, what school they get into, etc. So why can't we hold teachers accountable to their students performance?

Personally, I think private equity firms debt loading businesses then filing for bankruptcy or closing the doors killing hundreds of jobs is FAR bigger of a problem than what a CEO makes. If you aren't familiar with the tactic of debt loading, go do some reading, it'll piss you off and you're anger will be focused at groups that deserve it.
I realize it's not your main point at all but I'd like to clear up something in regard to education.
To answer the question as to why teacher pay is not tied to performance, the shortest answer is unions.
A longer answer is.....you would not want that anyway. It's been done and is always a disaster. There is not a worthwhile metric to assess what any given student has actually taken away from a certain teacher/course/school that I've come across. I mean that. Any and all incentives based on results of standardized testing I have ever seen does FAR more harm than good. It forces teachers to not teach. Instead, they force-feed students what will be on the test(s) and little else. Education dies when that happens and it gets replaced with rote-memorization, repetition, and standardized processes.
Education is not about knowledge alone. It is also about the application of knowledge and how to critically evaluate information. A teacher, if trained well and ethically, can evaluate their own students properly. Very few others can do so without the benefit of time. I'll leave it at that for the sake of brevity.

Also, I 100% agree with you about debt loading. It's predatory and vile.
 
I almost cut the education part out of it, but my point was exactly as you stated, not everything can be attributed to performance...even in cases where I would say it matters most such as educating the next generation. My "So why can't we hold teachers accountable to their students performance" was supposed to be essentially rhetorical. We can't hold them accountable, even with the intrinsic value of their positions. There are tons of reasons, unions are one, parents not taking an active roll in their kids education is another...but it's a long list...a very long list. So then with all of those extraneous factors, going back to my first question of, "how many teachers do you know that would be willing to base their salary on the performance of their students?" They wouldn't. Not a single one. And not a single one would stand there and tell me that it's not fair that they aren't held accountable and so they would like to forgo their earnings if the class doesn't all make passing grades........

Just as CEO pay can't and shouldn't necessarily correlate to the performance of their respective organizations/companies.

Edited to add: The last thing I want to debate is the profession of teacher/professor....it's never a pretty discussion. People get way too defensive when you start to criticize people in that line of work.
 
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First: Nobody who has worked in corporate America for any appreciable amount of time would mistake it for a meritocracy, nor believe that corporations generally make good decisions. In my experience, larger companies survive in spite of bad decisions, usually because of barriers to entry.

Second: The board of a publicly-held company should be acting in the best interests of the shareholders. Whether or not they are is an entirely different question, and one I think is worth asking. Personally, I think stratospheric CEO salaries help CEOs more than they do the companies that those CEOs run.
 
First: Nobody who has worked in corporate America for any appreciable amount of time would mistake it for a meritocracy, nor believe that corporations generally make good decisions. In my experience, larger companies survive in spite of bad decisions, usually because of barriers to entry.

Second: The board of a publicly-held company should be acting in the best interests of the shareholders. Whether or not they are is an entirely different question, and one I think is worth asking. Personally, I think stratospheric CEO salaries help CEOs more than they do the companies that those CEOs run.


Shareholders will pay ceo as long as it benefits them. Regardless of what decisions they make. So we can’t really have it both ways.
 
Shareholders will pay ceo as long as it benefits them. Regardless of what decisions they make. So we can’t really have it both ways.

Shareholders don't make hiring decisions; boards do. A strong argument could be made that boards are not acting in the best interests of the shareholders when they overpay under-performing CEOs.
 
I almost cut the education part out of it, but my point was exactly as you stated, not everything can be attributed to performance...even in cases where I would say it matters most such as educating the next generation. My "So why can't we hold teachers accountable to their students performance" was supposed to be essentially rhetorical. We can't hold them accountable, even with the intrinsic value of their positions. There are tons of reasons, unions are one, parents not taking an active roll in their kids education is another...but it's a long list...a very long list. So then with all of those extraneous factors, going back to my first question of, "how many teachers do you know that would be willing to base their salary on the performance of their students?" They wouldn't. Not a single one. And not a single one would stand there and tell me that it's not fair that they aren't held accountable and so they would like to forgo their earnings if the class doesn't all make passing grades........

Just as CEO pay can't and shouldn't necessarily correlate to the performance of their respective organizations/companies.

Edited to add: The last thing I want to debate is the profession of teacher/professor....it's never a pretty discussion. People get way too defensive when you start to criticize people in that line of work.
I think we agree. While many CEO's are paid a significant % of potential total earnings based on performance.....perhaps that's not the best way to do it.
To continue the minefield that is education....if you pay teachers based on performance they will seek to improve short-term gains (teaching the test) often at the cost of long-term utility/value (real education).
CEO's may be able to provide a short-term boost in share price (and thus their own earnings) but it may be to the long-term detriment of the company.

Interesting read on performance-based pay
 
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Some of you claiming shareholders are behind exorbitant executive pay should really take a look into the org that put out the report, As You Sow. Maybe then you'll realize that shareholders have less power than they once did thanks to the Boards of Directors effectively changing shareholder rights without shareholder say. Also, I would argue there is a difference between being a visionary and having delusions of grandeur, the latter likely being more common that one would think when considering the type of personality that makes it to CEO consideration.
 
Deserve?
Well, I do know that nobody here is in any position to say what another 'deserves'.
Considering that both are still employed, I'd say their respective Boards and shareholders are not unsatisfied.

This may come as a shock to you, but your opinion does not matter.

Your opinion also does not matter and yet here you are voicing it... it's almost as if this were some sort of internet posting board created for the purpose of having a discussion and not some sort of governing body how strange...
 
Your opinion also does not matter and yet here you are voicing it... it's almost as if this were some sort of internet posting board created for the purpose of having a discussion and not some sort of governing body how strange...
Great reply, guy.
Besides the fact that you don't know what an opinion is, it's great!

Your earlier comment that these two CEO's don't deserve their pay because they're not doing their jobs well is absolutely an opinion because it's based on your feelings.
My statement that their respective Boards and shareholders are not unsatified with their performance is a reasonable conclusion to make based on the available facts.

1. They remain employed by their respective companies/Boards.
2. There is no credible reason to believe that their asses are on the chopping block that I've seen.
3. Activision is showing record profits and that is not generally a reason for a CEO to lose their job.
 
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You are missing that these companies have to compete with other companies for talented CEOs. The companies may not want to, and the shareholders may not want to, but getting someone that has experience leading entire organizations means you are targeting a small group of individuals. They are often already employed doing the same thing at another organization, maybe even a competitor, and you have to lure them to the top of your organization somehow...just as sports teams lure the top players to their teams via large contracts with lots of bells and whistles. Other teams are trying to get those players, and while there a hundreds of guys in MLB that can hit the ball, only a few have demonstrated an ability to do so at a high level. You aren't going to go pay the guy with the .210 batting average the same thing that the guy getting the 300 million contract is getting, but then, you don't expect the guy batting .210 to do the same thing at the same level. You expect the big contract guy to drive ticket sales, drive in runs, make other people on the team better, pull in other top prospects who want to be a part of what you have going on.

It's really quite complicated in both cases, and I don't think you can simplify the argument down and still have a conversation or discussion that really makes sense.

Conflating CEO pay with the health of an organization isn't going to correlate as unfair as that is...and I hope that they never correlate despite what some folks want. "It's not fair", doesn't factor into the equation at all.

You have a successful company whose CEO is paid a lot of money

You have an unsuccessful company whose CEO is paid a lot of money

You have an unsuccessful company who is looking for a CEO to turn their company around...do they hire the guy for $100K who has no experience, or do they hire the guy that has experience and wants $15mil. How do you entice someone to captain a sinking ship? Just one example out of many. And again...it's complicated. Should the company pay the guy a $15 million pay out when they close their doors and everyone else in the company walks out with their hands in their pockets? Yeah that doesn't seem fair, but those employees could have left when they brought the guy on.

I am all for performance based pay...I encourage that when I can. Let's change things a bit..how many teachers do you know that would be willing to base their salary on the performance of their students? Hey when you are an adult working in corporate America, you can leave if you think the company doesn't have your best interests at heart. Students get the teacher they are given, no real choice to go to another teacher or class, and their performance in that class could determine their overall GPA, their understanding of that material on standardized testing, what school they get into, etc. So why can't we hold teachers accountable to their students performance?

Personally, I think private equity firms debt loading businesses then filing for bankruptcy or closing the doors killing hundreds of jobs is FAR bigger of a problem than what a CEO makes. If you aren't familiar with the tactic of debt loading, go do some reading, it'll piss you off and you're anger will be focused at groups that deserve it.

So you know better? You're sure starting to sound like that guy in the stockroom who knows it all and thinks CEO's sit on their asses all day drinking the tears of their employees and smoking cigars wrapped in 1,000 dollar bills.

Protip: If a company was doing something that negatively impacted what makes them profitable...they would alter said behavior if in any way possible. CEO's are earning a lot of money because they're often generating a lot of profit. If a company is a short-sighted as you suggest, it would not likely remain in business long.
You're arguing a different concept than I was getting at. With the rules as they are, yes, their behavior makes absolute sense. That's my point. The current system is to appease shareholders at all costs. Shareholders want increases quarter after quarter, year after year. That's not sustainable. This incentivizes behavior that threatens long term stability for short term gains.

Obviously CEOs have a lot of talent bringing in record short term profits AND trying to spin a story that this can go on forever to investors. You misunderstood what I was saying if you think I'm implying a CEO has no idea what he's doing. On the contrary, the problem is systemic, it's not the CEO, it's the current rules of business that are leading to this sort of behavior. Another person asked how is this anyone's business, well if it's systemic behavior that is damaging for economic sustainability across many industries, sooner or later, that affects us all.
 
You're arguing a different concept than I was getting at. With the rules as they are, yes, their behavior makes absolute sense. That's my point. The current system is to appease shareholders at all costs. Shareholders want increases quarter after quarter, year after year. That's not sustainable. This incentivizes behavior that threatens long term stability for short term gains.

Obviously CEOs have a lot of talent bringing in record short term profits AND trying to spin a story that this can go on forever to investors. You misunderstood what I was saying if you think I'm implying a CEO has no idea what he's doing. On the contrary, the problem is systemic, it's not the CEO, it's the current rules of business that are leading to this sort of behavior. Another person asked how is this anyone's business, well if it's systemic behavior that is damaging for economic sustainability across many industries, sooner or later, that affects us all.
I scrolled up to figure out why I said that to you, and can't figure out why. I must have been trying to reply to somebody else and clicked in error. Really not sure who it was aimed at, I may have been ranting for the sake of ranting.
We're on the same page about this topic it seems.

Here's the million dollar question.....How does it change for the better? We can't put the djinni back in the bottle.
 
I scrolled up to figure out why I said that to you, and can't figure out why. I must have been trying to reply to somebody else and clicked in error. Really not sure who it was aimed at, I may have been ranting for the sake of ranting.
We're on the same page about this topic it seems.

Here's the million dollar question.....How does it change for the better? We can't put the djinni back in the bottle.
There's many ways to solve the problem. Off the top of my head? Make stock buybacks illegal again. Tie CEO pay to company revenue and not stock performance. Wouldn't be a bad starting point.
 
Or tie CEO/Board of Directors pay to some average of their employees. It wasn't always this bad. A CEO did not suddenly become 300x smarter nor work 300x harder than their average employee in the 10 years between 1989 and 1999. So I'm not sure why he/she deserves to be paid 300x more. It's a self-perpetuating scam.

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Ya know, I love Jim Sterling when he's talking about gaming and gaming markets, but I can't agree with everything he says. Videos like this one are proof of that. I'm definitely on the side of hardwarephreak and Laowai here. CEOs do more work than I could imagine.


Also, to the one's calling CEOs sociopaths. You're not entirely wrong. There is a certain amount of psychopathic behaviors that are nearly required to be an effective CEO. I don't think that makes them evil, I think it makes them good at their job.
 
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The right CEO can make or break a company. Steve Jobs comes to mind. He was why Apple became so successful. And yes, some ceo's are easily worth 300x average worker pay, given they boost a company's standing in all areas. The reward structure is tied to stock to ensure the best outcome for both parties - ceo and company. The better the company does, the higher the rewards- for all.
It's very easy to dismiss their impact looking at the value of their contracts, but for companies worth hundreds of billions, they are a bargain.
 
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Also, to the one's calling CEOs sociopaths. You're not entirely wrong. There is a certain amount of psychopathic behaviors that are nearly required to be an effective CEO. I don't think that makes them evil, I think it makes them good at their job.
The two are not mutually exclusive. Even by your own words, if someone is engaged in what's considered psychopathic behavior, it's very likely to be something considered "evil." If it wasn't, it wouldn't be defined as psychopathic, which is defined by a complete absence of any conscience for your actions. If I make a good deal and have a good plan for a company, that doesn't make me psychopathic, that makes me good at business. If I make the same deal, but it depends on exploitation of others in ways I know will cause real harm to people, but I have no qualms about it, that means I'm acting like a psychopath AND I'm good at business.


The reward structure is tied to stock to ensure the best outcome for both parties - ceo and company. The better the company does, the higher the rewards- for all.
If the rewards were higher for all, they wouldn't be having a record number of layoffs the same time they're having record profits. Their "reward" for helping the company perform better than ever is unemployment. Your premise is flawed.
 
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Companies are first and foremost responsible to their investors - the shareholders. They do well, the company does well. As a bottom line analysis, workers unfortunately do not sway that outcome. Don't like the job? No problem, they will find someone that does.

As far as record layoffs, well that can be on of several different things. Short term money grab or technological advancement are a couple that come to mind. Just because you should morally higher someone does not mean it makes fiscal or financial sense to do so (esp. when things can be done faster, cheaper and more efficiently otherwise).

All of these entities are for profit businesses. They exist to make money. I hope I'm not being too harsh, but that has been my experience so far , and I've learned to not take it personally.
 
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Companies are first and foremost responsible to their investors - the shareholders. They do well, the company does well.
OR as others mentioned, they can debt load and bail. There's not necessarily a correlation between investors doing well and the company doing well. It more depends on how sound the business practices are. Maximizing quarter profits at all costs usually leads to hollowing out the foundation since it requires more tricks for short terms boosts rather than something less immediately profitable, but more stable in the long term. You can make a lot of money now if you kick the costs down the road to a later date. If a company doesn't have a ground breaking innovation, that's typically the way to get record highs and is a perfect recipe for a boom-bust cycle. Laying off hundreds of employees only makes it that much more extreme.

As a bottom line analysis, workers unfortunately do not sway that outcome. Don't like the job? No problem, they will find someone that does.
I was responding more to your statement "the higher the rewards for all" indicating that's objectively not true when at a time the company couldn't be doing better, a significant portion of its workers are receiving no rewards at all and are losing their jobs.

As far as record layoffs, well that can be on of several different things. Short term money grab or technological advancement are a couple that come to mind. Just because you should morally higher someone does not mean it makes fiscal or financial sense to do so (esp. when things can be done faster, cheaper and more efficiently otherwise).
The morality of it is a completely separate issue and much more debatable. I was looking at it from a stability standpoint. If you're having record firings the same time you're having record income, like you said, that means it's probably one of two things, a money grab or obsolescence from technology. In the case of a company like Activision, it's highly likely to be the former. Record profits traditionally means that's a good time to reinvest and get more projects off the ground so you're not putting all your eggs in one basket. However, reinvestment is ALSO a cost, meaning it doesn't make investors happy in the short term.

In other words, what makes the optimum fiscal sense for next quarter is often NOT what makes the most fiscal sense for the next 5, 10 years.
 
Companies are first and foremost responsible to their investors - the shareholders. They do well, the company does well. As a bottom line analysis, workers unfortunately do not sway that outcome. Don't like the job? No problem, they will find someone that does.
So why don't companies simply hire CEOs willing to work for 1/10 of what they're currently getting paid? I'm sure there are plenty of smart business execs out there that would be happy to work for $1.5 million a year vs the $15 million average that current CEOs are getting paid. Answer? Because it's a self-perpetuating scam. The Board of Directors hire CEO's at inflated rates because then they can tie their own exorbitant salary to his.
 
The right CEO can make or break a company. Steve Jobs comes to mind. He was why Apple became so successful. And yes, some ceo's are easily worth 300x average worker pay, given they boost a company's standing in all areas. The reward structure is tied to stock to ensure the best outcome for both parties - ceo and company. The better the company does, the higher the rewards- for all.
It's very easy to dismiss their impact looking at the value of their contracts, but for companies worth hundreds of billions, they are a bargain.

When you say and infer idiotic things, like the CEO's of EA and Activision are just like Steve Jobs and are actually worth 300 times the pay of the average of one of their workers... while in fact those same CEO's are laying waste to wide swaths of their employees and are directly responsible for the products being produced which have pretty much turned to garbage, I begin to question if you actually are an idiot or are just trying really hard to become one.
 
Record profits traditionally means that's a good time to reinvest and get more projects off the ground so you're not putting all your eggs in one basket. However, reinvestment is ALSO a cost, meaning it doesn't make investors happy in the short term.
I agree with most of what you said. Keep in mind, there are also companies that hold and hoard cash, like MS did for a good number of years. Reinvesting is a solid long-term approach, but like you said, you need to make sure the investors stay happy. That's why you need to take care of them - reduce costs or boost stock value.

So why don't companies simply hire CEOs willing to work for 1/10 of what they're currently getting paid? I'm sure there are plenty of smart business execs out there that would be happy to work for $1.5 million a year vs the $15 million average that current CEOs are getting paid. Answer? Because it's a self-perpetuating scam. The Board of Directors hire CEO's at inflated rates because then they can tie their own exorbitant salary to his.

Unfortunately, not many would work for that amount these days. The larger the business, the more they will pay. For startups or small size places, that may work. Everything else, not a chance. Heck , a few nonprofits pay their execs close to those numbers. And most companies know this.
 
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When you say and infer idiotic things, like the CEO's of EA and Activision are just like Steve Jobs and are actually worth 300 times the pay of the average of one of their workers... while in fact those same CEO's are laying waste to wide swaths of their employees and are directly responsible for the products being produced which have pretty much turned to garbage, I begin to question if you actually are an idiot or are just trying really hard to become one.

Listen guy, I don't know you from a hole in the wall, but you need to relax and mind yourself. You're talking shit because I don't agree with your ideas? Calm down champ. EA and Activision decide what they pay them , not you or I. Keep getting angry though, I'm sure that will change things for them.
 
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Listen guy, I don't know you from a hole in the wall, but you need to relax and mind yourself. You're talking shit because I don't agree with your ideas? Calm down champ. EA and Activision decide what they pay them , not you or I. Keep getting angry though, I'm sure that will change things for them.

Perfectly calm here. I'm just amazed that you actually believe that the CEO of EA deserves a salary in excess of $35 million a year given the products he is directly responsible for producing and your arguement is that... well, it's just how it is and that's fine.
 
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