clt says this is interesting, but not in the best interest of his company.
clt says this is interesting, but not in the best interest of his company.[/quote]if he can afford it, why isn’t it? Employees that are paid well are generally happier and far more loyal to the company. that’s worth a lot.
Company pays employees what it wants to pay them.
ground breaking
It’s a noble act by the ceo. In the long run though he may be doing a disservice to the employees if the company is not providing development and educational support for the employees. It’s similar to when a union negotiates a pay scale in excess of the market. When things are great that is fine but when times get tough can the company continue to pay at that rate and when/if employees are let go or move they will be unable to find a job that pays them what they were accustom to making because their skill set is not as valuable as what they were being paid.
The other thing is it disrupts the notion of pay based on performance and responsibility. Unless the ceo worked a annual bonus based on performance this totally disrupts a company’s pay culture to saying everyone at the company is valued equally from a fiscal point of view. That sounds great but reality is much different. Is the ceo really as replaceable as a frontline customer service rep? I’m not saying the customer service rep isn’t important, just that when one leaves it’s easier to replace than a solid ceo.
I do think senior positions are overpaid and that their pay should be based on success of the company but I also think a company has to be wise in maintaining pay culture and support for their employees growth and future.
[quote=“ninerID, post:4, topic:29556”]Company pays employees what it wants to pay them.
ground breaking[/quote]While I think that this is partially a publicity stunt, it’s newsworthy because it goes against the current wage trend of ridiculous C-level pay and mediocre pay elsewhere.
If the CEO of my company took the same approach, it would be groundbreaking.
I expected his company profit being greater than 2.2mm. If his business grows, great. If it decreases… Either he has to take no salary, pay payroll out of his pocket, do layoffs, or decrease salaries.
One would think this is a publicity stunt… however in that line of work I don’t see public good will improving business. In his world they need to be priced correctly per transaction and have no processing breaks. If it gets and retains a higher caliber employee its a win for him… But as others noted, those 70k jobs are a hell of a lot more beneficial to cut if things go south a couple quarters in a row.
clt says this is interesting, but not in the best interest of his company.[/quote]if he can afford it, why isn’t it? Employees that are paid well are generally happier and far more loyal to the company. that’s worth a lot.[/quote]
clt says the role of a business is to increase shareholder wealth.
clt says this is interesting, but not in the best interest of his company.[/quote]if he can afford it, why isn’t it? Employees that are paid well are generally happier and far more loyal to the company. that’s worth a lot.[/quote]
clt says the role of a business is to increase shareholder wealth.[/quote]
That is the attitude that is a big part as to why our economy is f#cked.
clt says this is interesting, but not in the best interest of his company.[/quote]if he can afford it, why isn’t it? Employees that are paid well are generally happier and far more loyal to the company. that’s worth a lot.[/quote]
clt says the role of a business is to increase shareholder wealth.[/quote]
NLP notes this company is privately owned.
clt says this is interesting, but not in the best interest of his company.[/quote]if he can afford it, why isn’t it? Employees that are paid well are generally happier and far more loyal to the company. that’s worth a lot.[/quote]
clt says the role of a business is to increase shareholder wealth.[/quote]That’s the reason the wealth gap is growing.If the shareholders actually re-invested their wealth back into growing the economy, it wouldn’t be a problem, but trickle down economics is a fantasy. Instead, the rich are getting richer and the middle class is getting squeezed.
clt says this is interesting, but not in the best interest of his company.[/quote]if he can afford it, why isn’t it? Employees that are paid well are generally happier and far more loyal to the company. that’s worth a lot.[/quote]
clt says the role of a business is to increase shareholder wealth.[/quote]That’s the reason the wealth gap is growing.If the shareholders actually re-invested their wealth back into growing the economy, it wouldn’t be a problem, but trickle down economics is a fantasy. Instead, the rich are getting richer and the middle class is getting squeezed.[/quote] The middle class is getting something done to it. “Squeezed” isn’t the word I would use. (Hint: starts with "f’)
clt says this is interesting, but not in the best interest of his company.[/quote]if he can afford it, why isn’t it? Employees that are paid well are generally happier and far more loyal to the company. that’s worth a lot.[/quote]
clt says the role of a business is to increase shareholder wealth.[/quote]That’s the reason the wealth gap is growing.If the shareholders actually re-invested their wealth back into growing the economy, it wouldn’t be a problem, but trickle down economics is a fantasy. Instead, the rich are getting richer and the middle class is getting squeezed.[/quote]
There is an interesting book, not directly on this subject, but it is related. Talks about points spreads and the stock market. Anyway, the gist is in the 70s there was a shift in how publicly traded companies were viewed, the whole change from serving customers to serving shareholders. If I can remember the book I will post it.
Just to play devil’s advocate, why should companies invest in their companies instead of taken care of their shareholders if there is little to no demand or signs of growth potential?
clt says this is interesting, but not in the best interest of his company.[/quote]if he can afford it, why isn’t it? Employees that are paid well are generally happier and far more loyal to the company. that’s worth a lot.[/quote]
clt says the role of a business is to increase shareholder wealth.[/quote]That’s the reason the wealth gap is growing.If the shareholders actually re-invested their wealth back into growing the economy, it wouldn’t be a problem, but trickle down economics is a fantasy. Instead, the rich are getting richer and the middle class is getting squeezed.[/quote]
There is an interesting book, not directly on this subject, but it is related. Talks about points spreads and the stock market. Anyway, the gist is in the 70s there was a shift in how publicly traded companies were viewed, the whole change from serving customers to serving shareholders. If I can remember the book I will post it.
Just to play devil’s advocate, why should companies invest in their companies instead of taken care of their shareholders if there is little to no demand or signs of growth potential?[/quote]
If you stop thinking about shareholders as shareholders and start thinking about them as owners in the company then it makes sense. Doesn’t every owner want their business to be profitable for them? I would say the greatest challenge is the CEOs and leadership often focus on short term growth at the expense of long term potential so that they can make quick returns to the shareholders. Stronger CEOs with a vision and the ability to actually lead a company and articulate their plans are what is needed. The proiblem with that approach is if your share value declines too far your competitors will start licking their chops.
Also have to remember that much of the middle class is benefiting to some degree if they have participate in retirement accounts. It is an easy target to complain about shareholders and dividends - but that is one of the key drivers in growing your retirement account.
Like everything it’s isn’t as black and white. I certainly think companies go too far with focusing on shareholdeer value, but I think it is incorrect to say that is wrong.
[quote=“JediWupAss, post:15, topic:29556”]If you stop thinking about shareholders as shareholders and start thinking about them as owners in the company then it makes sense. Doesn’t every owner want their business to be profitable for them? [/quote]But there is a difference. Business owners typically care about long term and sustainable success. The current trend for shareholders is “give me money now!” with complete disregard for the future of the company or the well-being and happiness of the employees.
Owners are typically hands on and directly involved with employees, meaning each person truly is more than a number. Shareholders just view you and I as entries on a ledger.
[quote=“J Felt, post:16, topic:29556”][quote=“JediWupAss, post:15, topic:29556”]If you stop thinking about shareholders as shareholders and start thinking about them as owners in the company then it makes sense. Doesn’t every owner want their business to be profitable for them? [/quote]But there is a difference. Business owners typically care about long term and sustainable success. The current trend for shareholders is “give me money now!” with complete disregard for the future of the company or the well-being and happiness of the employees.
Owners are typically hands on and directly involved with employees, meaning each person truly is more than a number. Shareholders just view you and I as entries on a ledger.[/quote]
Correct which is why the ceo and senior leaders are so important. They are the ones who need to sell that to the shareholders, but instead they go along with the short term gains. Which takes us back to CEO pay - man if you get a really good CEO that can sell a vision, provide long term growth, short term gains and maintain employee morale - they are worth some insane salary.
That is not the issue at hand though. It is about the allocation of employee expense between executives and non-officer employees. If the discussion is to be framed compensation vs shareholder return, then the excessive CEO pay should go to the shareholders if that is your contention.
There is a healthy debate about ROI of investing in employees at a reasonable level vs enormous (over) investment in executives who functionally have a debatable impact on profitability (and oftentimes get paid regardless of whether the company makes any money).
I really posted this just as a “restoring my faith in humanity” moment. Whether or not this was a savvy business move can be debated… But it sure as hell was a moment of genuine humanity and altruism; and an example of someonly acting where they can in a micro environment to affect the greater good. If every board of officers/execs did something like this (not even to this extreme), the resulting boost to the working (not lazy, poor, etc) middle class’ well being and the collective boost to the consumer economy would potentially be returned, possibly in multiples of the initial investment. They would effectively be rolling back the negative course of the past 5 decades… It’s an interesting thought. And again, kudos to this guy for at least trying to live by his conscience. That is so sorely missing in the modern business world.
That is not the issue at hand though. It is about the allocation of employee expense between executives and non-officer employees. If the discussion is to be framed compensation vs shareholder return, then the excessive CEO pay should go to the shareholders if that is your contention.
There is a healthy debate about ROI of investing in employees at a reasonable level vs enormous (over) investment in executives who functionally have a debatable impact on profitability (and oftentimes get paid regardless of whether the company makes any money).
I really posted this just as a “restoring my faith in humanity” moment. Whether or not this was a savvy business move can be debated… But it sure as hell was a moment of genuine humanity and altruism; and an example of someonly acting where they can in a micro environment to affect the greater good. If every board of officers/execs did something like this (not even to this extreme), the resulting boost to the working (not lazy, poor, etc) middle class’ well being and the collective boost to the consumer economy would potentially be returned, possibly in multiples of the initial investment. They would effectively be rolling back the negative course of the past 5 decades… It’s an interesting thought. And again, kudos to this guy for at least trying to live by his conscience. That is so sorely missing in the modern business world.[/quote]
I agree, the problem like Jedi said is short term vs long term. This was an early focus on the book I can’t remember the name of, but it points to the 1970s for when things started to changed. Performance quarter to quarter is more important than the overall performance of the company. The book used an example about betting on Patriots games the season they went 18-1. Wish I could remember it damnit!
I’m a little surprised greenman has not posted in this thread.
Isn’t he an expert on this stuff?