| Topic: | Re:Re:Re:Re:Are any Executives / CEO's worth £4.96 million | |
| Posted by: | Dan Murphy | |
| Date/Time: | 17/08/15 20:27:00 |
| In terms of CEO performance, it's pretty easy to define. If a company's valuation (and therefore incremental value accruing to shareholders) grows significantly, and that growth in valuation can be attributed to the unique skills, experience, and management abilities of the CEO, then shareholders may well decide to award that CEO a significant compensation as a reward for the growth, and to retain the services to ensure future growth. I can think of numerous examples of this over recent years. The examples that springs to mind would be Charles Wilson at Booker, Lord Wolfson at Next, or Nick Robertson at ASOS.com Nobody (surely) would argue that these guys are not worth every penny (and in the case of Lord Wolfson, he pretty much makes a point of handing back much of his bonuses so that store staff can all share in the bonanza). Of course, there are examples of CEOs who accept bonuses based upon other convoluted incentive schemes, where the relationship between remuneration and value growth may not be so obvious. But it doesn't detract from the underlying principle, which is that some people are such superb CEOs and leaders that they deserve every penny of their very high pay. We often hear people say "Well, I would do his job for a 10th of what he is paid". And my answer to that is "Oh yeah? Well give it your best shot, let's see how you get on". It ain't that easy. |