The Fourteenth Banker Blog

May 4, 2010

CEO Pay Redux

Filed under: Uncategorized — thefourteenthbanker @ 10:30 PM

How insidious is CEO pay on society?    From the Roosevelt Institute in this post, “When a lot of important people act this way, there is enormous pressure to let things slide. Our economy becomes less real and less safe. At the same time, transactional practices and businesses morph into transactional ethics. The social contract between business and society changes for the worse. And any sense of corporate social responsibility goes out the window. So, yes, I think we should care.”

I will tell you things are sliding.  I heard from one friend at a Regional bank that she cannot stand the culture anymore and has to leave.  There is not merit, only favoritism.   I heard from another at a different bank that promotions are going to those who do not even practice what they preach.   Their self explanations of presumed  success are countermanded by documentation and the opinions of those they work with.  But what they do have is that they are “pleasers” to those above.   Their results are worse than other candidates’, but the manner in which they pretended to obtain those results validates the similar claims to success spouted by the superiors.

I’ve heard that described as the “conspiracy to mis-lead”.   It is a conspiracy in that the leader gets to pretend to lead, the subordinate pretends to be well led, and they both collect the money.

That’s not to say we should feel hopeless.  It is to say we should fix it.

Vote your shares against management’s recommendations.

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4 Comments »

  1. Welcome to the world documented by the “Dilbert” cartoons.

    This seems to be a nearly constant feature of large organizations. When the Dilbert cartoons first proved widely popular, I was shocked, as I thought the stories of irrational management were somehow a local occurrence. Large islands of counterproductive and irrational behavior seem to be common to large organizations.

    As noted elsewhere, the ability to fail often, quickly, and cheaply seems to be key to long term successful organizations. There is no advantage to large, slow, and expensive failures. Large organizations tend to hide failures, where they can.

    Someday, this will all be reduced down to a science.

    Comment by Preston L. Bannister — May 5, 2010 @ 12:02 AM | Reply

    • You are so right on. I have been tempted to cut these out and give them to folks but that would be a full time job. (and hazardous in humorless offices)

      Comment by thefourteenthbanker — May 5, 2010 @ 1:15 AM | Reply

    • LOL – funny you should mention Dilbert – I work at a large, well-known and respected university, and I can tell you, Dilbert lives here. I have several appropriate panels on the walls of my cubicle, in fact.

      It is terrifying to know that I am approaching the least resilient years of my life in a world that is being run by and for this mentality. I read a headline on HuffPost just now that said Lloyd Blankfein got a standing ovation at the annual meeting when earnings were announced. Of course he did. That just proves that they literally live in a different world, and by different rules, than the rest of us. Too bad world the rest of us live in can be brought down by their miscalculations and hubris.

      Comment by Sandi — May 5, 2010 @ 3:36 PM | Reply

      • My bad – the standing ovation wasn’t the annual meeting – it was a meeting of other execs. But of course.

        Comment by Sandi — May 5, 2010 @ 3:56 PM


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