The relationship between greed and CEO compensation

Or, why having a powerful advisory board is so important to keep your leadership team in check

The relationship between greed and CEO compensation
ch how much your CEOs are getting compensated: if it seems excessive, it could well be affecting firm performance, according to an analysis of more than 300 publicly traded firms by the University of Delaware.

When CEOs had compensation that was significantly higher than the next most highly paid executive, or when they were paid significantly more than other firms of a similar size and risk, performance and dividends tended to be lower than average.
You might also like: How many CEOs is too many?

However, the effect of CEO self-interest was mitigated by powerful company boards, said study author Katalin Haynes.

"Some CEOs appear to direct more of the firm's resources toward themselves than others and this can occur more when managers have a lot of discretion or have a short tenure, or if the board is weak," said Haynes. "Interestingly, we found that the negative effects of executive greed on shareholder wealth decrease as CEOs experience more time in their role."
According to Equilar, the highest paid CEOs in publicly traded American firms are:
  1. Charif Souki, Cheniere Energy, $141,949,280
  2. Mario Gabelli, GAMCO Investors, $85,049,800
  3. Lawrence Ellison, Oracle, $78,440,657
  4. Leslie Moonves, CBS, $65,589,245
  5. W Nicholas Howley, TransDigm Group, $64,214,656
  6. Don Mattrick, Zynga, $57,814,391
  7. Richard Adkerson, Freeport-McMoRan Copper & Gold, $55,260,539
  8. Jeffrey Weiner, LinkedIn, $49,071,364
  9. Stephen Kaufer, TripAdvisor, $39,014,227
  10. Phillipe Dauman, Viacom, $37,186,099

Recent articles & video

Four ways to improve recruiting and retention

Department of Labor releases final rule on 401(k) plan investments

How to Create a Phenomenal Employee Experience & Future Proof Your HR Strategy in 2023

Can an employer stop medical treatment authorized for a worker's injury?

Most Read Articles

Does your benefits package include an employee discounts program?

Furniture company fires 2,700 workers just before Thanksgiving

32% of Americans admit to lying on their resume