Comment Re:Yes. (Score 1) 1216
After all, it is not the CEO's who own corporations, but the shareholders. As such, it is the shareholders who ultimately decide upon the pay of the CEO. If the owners of a company decide that it is in the company's best interest to entice the top executives with $x, there is absolutely nothing wrong with that. Contrary to popular belief, the only way this is possible in the long run, is if the executive actually brings that worth to the corporation.
I'm not so sure about that. You talk about how an overpriced CEO is not sustainable in the long run. You also - correctly - said that it's the shareholders who pay the CEO. But since when are shareholders interested in the long run? Ok, some will invest for the long term, of course. But realistically, shareholders are interested in their own ROI, first and foremost, not the long-term health of the company.
The shareholders will approve of any CEO which they think will maximize their ROI. If this means destroying the company over the long term then many investors will be fine with it, as long as they make a good return before it all falls down. The long term health of the company, the well beeing of the workers, even the customers... it's all acceptable collateral damage in achieving that goal. The shareholders are generally in it for their own good, not for the good of the company.
I don't want to make blanket statements here: There's no doubt that there are also plenty of investors that do want to invest for the long term and would probably like to see the company succeed. And in many cases investors will have decided that a long term success of the company is the best way to achieve a good ROI for themselves. But there's rarely an emotional or compassionate connection to the company. Instead, it's mostly just about maximizing ROI. That's why they are investors.
So, don't count on the "shareholders" to magically only support CEO salaries that sustainable in the long-term. That's just not the case.