ipl-logo

Why Ceos Should Get Paid Essay

434 Words2 Pages

Do CEOs really get paid a lot more than an average worker? Some economists say they have found many CEOs that are worth being paid as much as they are, but social scientists are now examining closely at the psychological effects of CEO’s pay on corporate life. Among them is O'Reilly, the Frank E. Buck Professor of Human Resources Management and Organizational Behavior, who has conducted a series of studies that try to explain CEO compensation, ranging from how corporate boards decide upon salaries to how social status figures in setting executive pay(@stanfordbiz, Graduate School). One of O'Reilly's latest researches with James Wade of Rutgers University and Tim Pollock of Pennsylvania State University closely researched how the CEOs salaries …show more content…

For example,in his research, he found that a CEO in a firm was overpaid by 50 percent, while the general managers were underpaid by 50 percent. "People have been trying to justify why CEOs get paid so much. What people haven't been looking at is the consequences of making a wrong decision — paying too much or too little” says O’Reilly. An overpayment can lead to an increased wage bill and that money goes to shareholders. An overpayment can also lead to turnovers at lower levels, such as the general managers. Although O’Reilly’s studies tracked only lower levels of senior management, the research suggested that the negative outcomes of CEO overpayment are likely to drop down. For example, O’Reilly says, “That this same psychological process can work in an automobile assembly plant." This shows when a CEO gets a huge bonus, but the company is not doing well and the average workers feel underpaid compared to the CEO. What can this likely impact on the CEO’s company? Workers can decrease their effort in their work, and increase allegiance to the union. O'Reilly even found that unequal pay cascades down all the way to the senior management from the

Show More
Related
732 Words | 3 Pages

Due to inequality within the company the employee’s motivation dropped. Within the case study, upper level management would only disperse bonuses and incentives only if the company was doing well, which was unfair to the employees. The employees at the company complained numerous times that their supervisors should receive a reduced bonus, because the supervisors were not working as hard as the laborers (Beer & Collins, 2008, p.6). Therefore, reverse psychology is that if an employee doesn’t get compensated or rewarded a bonus they would do the opposite and become less motivated and not put in enough effort at work, which could affect the productivity of the

Read More
728 Words | 3 Pages

Due to inequality within the company the employee’s motivation dropped. Within the case study, upper level management would only disperse bonuses and incentives only if the company was doing well, which was unfair to the employees. The employees at the company complained numerous times that their supervisors should receive a reduced bonus, because the supervisors were not working as hard as the laborers (Beer & Collins, 2008, p.6). Therefore, reverse psychology is that if an employee doesn’t get compensated or rewarded a bonus they would do the opposite and become less motivated and not put in enough effort at work, which could affect the productivity of the

Read More
436 Words | 2 Pages

But instead they base it on income. One example is that there was an article it was called “What Is The Value Of A Human Life”. It was about the 911 terrorist attacks and a certain man named Kenneth Feinberg had to make a choice on how much compensation each individual received he chose to do it based on their occupation. For example the chef made less money there for less compensation.

Read More
1815 Words | 8 Pages

This essay expresses the opinion of Tara Siegel Bernard on behalf of the existence of the gender pay gap and focuses on it being a primary issue in the workplaces of major companies. The essay goes on to discuss how our society expects women and men to both behave in particular ways and how that idea has contributed to the ever present pay gap, such as how “. . . the imbalance often traces back to women being hired at a lower salary than their male peers” and “. . . women are less inclined to ask for raises. . .” Pointing out the possible reasons for the gender pay gap helps to establish the need for companies and our country’s leaders to find solutions.

Read More
191 Words | 1 Pages

In the article, “Do Remote Bosses Cause Inequality?” (Sept. 19, 2015), Froma Harrop claims that “Bosses and their investors are grabbing most of the profits.” The piece details what Harrop says to be a reason for the widening pay gap that’s not exactly economic. The unemployment has fell to a low percentage of 5.1 and productivity gains are present which are supposed to lead to higher wages; lowest wages are essentially falling, although workers are producing and making the needful in the same amount of time. Harrop argues one of the many reasons for the lack of a raise in paychecks: the apparent remoteness of the boss and the employee.

Read More
427 Words | 2 Pages

Justin Liberatore November 11, 2014 Ms. Stoneking English 111 My Issue: Are CEOs paid too much money? Overview of debate: It is historically known that many CEOs are grossly overpaid for typically doing far less work than most people think. CEOs act as company figureheads. They are often depicted sitting in big black leather chairs at the head of boardroom tables, or in oversized offices with multiple assistants running amuck doing work the CEOs were hired to do.

Read More
828 Words | 4 Pages

The desert view is that the CEO gets what he deserves as evaluated by his performance (Moriarty 267). The third potential view is the utility view and it defines a just wage as one that is give en attract, retain, and especially motivate the CEO so they may maximize the firm’s wealth (Moriarty 268). If any of these views are valid, then he claims it follows that CEOs are paid too much (Moriarty 272). Although Moriarty does make some valid points, I do not agree with all that he states.

Read More
812 Words | 4 Pages

“Cristiano Ronaldo makes $56 million a year, Kobe Bryant made $250 million a year and Barack Obama made $400,000 a year during his presidency...” (O'Connor ). Professional athletes are paid millions of dollars to play a game while police officers, firefighters, army soldiers, and even the president are paid significantly less. “It’s not shocking that public servants like teachers and police officers make less than professional athletes”(Figueroa). Compensation shouldn't be about entertainment, it should be about job importance because people are trying to make the world a better and safer place not a more entertaining place.

Read More
475 Words | 2 Pages

Based on a video of Wealth Inequality in America, “ The richest (1 percent) is now (2012) taking up almost a quarter (24%) of the national income home; in 1976 they took home only 9%; meaning their share of income has tripled between 30 years.” *add where quote is from*“CEO’s of major corporations earn nearly 300 times more than an average worker.” How is it possible that a CEO earns multiple times more than a regular

Read More
2489 Words | 10 Pages

Shining some much-needed sunlight on the gender wage gap will make a difference for every one of us, men and women, right now.” (www.nytimes.com, 16). “It’s the twenty-first century, and the gender wage gap affects the daily life of women throughout the country, at every economic level, from cashier to CEO. Is it fair? No.

Read More
796 Words | 4 Pages

The person that runs are country doesn’t make as much, people who save lives don’t make as much, teachers don’t make as

Read More
484 Words | 2 Pages

Dear, Those who can make a change We have all heard about how women are paid only a percentage of what men are paid. Are you aware that currently females make 80 cents for every dollar a male and that this is that this is considered huge progress. For me huge progress would be if the wage gap was within a few cents or no gap at all. Without actual change from legislatures or employers the current rate from 1960 the gender wage gap is projected to end in 2059. Now that is just ridiculous that we would have to wait 40 years for change to happen by itself instead of actually bringing about change.

Read More
598 Words | 3 Pages

Income inequality has emerged as a major political and policy issue, and chief executive pay has become a potent symbol of the growing divide between rich and poor. Many economists argue that the widening gap hurts the economy: When wealth is concentrated instead of broadly distributed, it curtails the spending of middle- and lower-income consumers who ultimately drive the US economy. In the United States, compensation for chief executives soared 937 percent between 1978 and 2013, while the average worker’s compensation climbed just 10 percent, according to the Economic Policy Institute (Johnston, 2014). Some, specifically those who benefit would argue for a large gap between CEO pay and the average employee pay. They may argue that the pay

Read More
909 Words | 4 Pages

Equal pay is something women have fought over for a long time, but still haven’t got it. Just because women have only a little less experience as they have to take care of children doesn’t mean they shouldn’t get the same salary. Equal pay is favorable since it boosts the economy, makes the company look better, and helps everyone. Why would equal pay boost the economy, though? Foremost of all, women spend a sizable portion of their income, which leads to higher demand.

Read More
1015 Words | 5 Pages

Are actors and professional athletes overpaid? The film industry and professional sports are regarded to be the most profitable business sector in the present scenario. The professional artists and film actors earn millions of dollars due to their talent.many people might have had a dream to be popular and earn more like they do. Despite the fact that their profession is not an easy job that could be done by common people, they are more prone to criticism resulting from their overpaid work. However, the perception on whether the professional artists and actors are overpaid or not is still a matter of concern of a majority of people.

Read More

More about Why Ceos Should Get Paid Essay

Related Topics

Open Document