Management Ethics: The Ethics of Executive Compensation

Would you love to have a means of having your friends and closest work buddies, determine your salary? And would you be likely to help those friends themselves increase their salaries? How about if in helping those friends, you might also help yourself?

Such is the apparent situation in Executive Compensation. Many of today’s Executives of mid-size to large firms have what are known as “associations”. These “associations” deal with interrelationships with other entities, be they other company’s boards of directors, or the actual individual members of those Boards. “Associations” of upper echelon executives and members of the Boards for a company with which I have much experience, numbered from a few dozen to in excess of 400 in this company.

Add to that the fact that Companies love to run comparisons on the salary levels of the competition. So the CEO of “my” company with his/her over 400 “associations” can vote for a pay raise for any of the CEO’s on whose board he/she has a seat, and in affect be providing an upward push to his/her own salary, both through the “relationships” and the competitive analysis.

Oh, and don’t just compare salaries. Check out the other benefits. Funny how you and I make $30,000 a year, we are hopefully paid $30,000 a year. But an Executive getting paid in excess of $1,000,000 dollars per year will pull down many multiples of that in stock options and benefits. Kind of sounds like our members of the Congress of our Federal Government!! Ever wonder why a Congressman will willingly spend millions of dollars to get elected to a position that pays less than $200,000? Sure, much of those millions he/she spends will be “our” money, but for the true picture don’t look at the salary, look at the benefits, the retirement, options, etc.

As always, more information on Harassment and Sexual Harassment is available at this site. Hope to see you there.

Bill Barger

Barger Specialties LLC

Mr. Barger became interested in the subject of Sexual Harassment early in his present job. He then began a course of study ending in the 2001 awarding of a Master of Arts degree in Business. During that course of study, and since that time he has researched, reported on, and taught Sexual Harassment to Business Communication’s Strategies students, and Ethics students in the Business and Nursing Colleges.

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Tags: ethics, compensation, executive, pay, survey