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EXECUTIVE COMPENSATION SHOULD NOT BE CAPPED Stock market investors in America and Europe agree that top managers get tremendously huge salaries. This became an issue three decades ago when their salaries skyrocketed especially during the turn of the millennium. Yet, looking at the issue deeply, one sees that these highly-salaried top executives hold jobs that need not be envied at all. Most people attribute this increase to Executive Boards who agree with everything pertaining to increases in their salaries at the expense of the savers.
This was aggravated by the fact that the top executives did not perform well to deserve such a fortune. Critics say their performance was mediocre and most of the companies to where they belong hit the slump in years during their tenure of office. These companies included AT & T, Merck and Time Warner, Home Depot and even Hewlett-Packard. In order to analyze the issue, it is essential that people are aware of the ramifications of the issue on motives and incentives. For instance, according to author Carr of the Business Source Provider, the key is not to permit these executives to work harder but to recruit good managers and leave to these qualified people the difficult decisions which could break or make a company. If these top managers were not given high paying jobs, they could easily pass it over to another one until it remains afloat.
These decisions are precarious and would entail the judgment and keen eye of someone who is paid well specifically in his area of expertise. Second, looks can be deceiving. It does mean that when a top executive looks cool, he is not necessarily relaxed in the inside. He may be trying to figure out the pros and cons of shutting a subsidiary or foregoing a tempting acquisition. If not compensated properly with a high pay, no one would ever want to handle such a position. Third, pay is the outsiders most concrete test of a boards capacity to monitor a companys executives.
In fact, Mr. Bebchuk who had been one of the sharpest critics of high-paying officials is the first to say that pay is not isolated: it is a classic board function important beyond dollars. It is the job of the owners to make sure that the managers are monitors in their use of company assets. Fourth, these top managers are people who work hard and succeed in the business world. They are often the ones who rise from the ranks, reaping the benefits of high salaries. The persons who receive high paying jobs are not to be envied because they are lighting their endpoints and are often treated as dramatically overpaid.
In the same manner, the organizations employees must have complete trust on the people who run their company. Trust is the glue in the work environment. It is an outcome of relationships. It is something that results in the workplace when everyones behavior is based on the core values of collaborative work ethic.
Related to this, there needs to be a recognition that the culture must change. Authority and command no longer work in producing high-performance organizations. There is also a need to have a willingness on the part of management to create a new covenant with the workforce, a covenant based on the values of collaboration. There is just a need to be more transparent with what the upper echelons of the organization receive.
Otherwise, this will undermine the companies. This is not to overlook the fact that there are some abuses and maneuverings when it comes to the executive pay. Some senior managers in workplaces today are under investigation for backdating their share options. They are able to work out the timing of grants in order to increase the likelihood of payment. There is a need for reforms in this area, but the problem needs to be reckoned with, one step at a time.
However, popular opinion can sometimes err too. The big share of executives pay is indeed deserved since shareholders are able to get value for the money they handed over. Many managers are said to have been performing well, and this goes the same for the shareholders. By laying out the arguments clearly, the authors are able to provide a clear picture on the issue that concerns the salaries of top executives. The motivation is also presented effectively.
It serves to support the main thesis of the article. The findings also give a clear picture of the current state of salaries for top businessmen and executives. Some eventually argues that the blame should not be placed on the firms themselves. There is a contention that multinational companies are merely victims of a market system that needs to be revised. Lastly, the use of examples is also carried out effectively. The needs of groups and teams of all kinds across the organization need to engage in the creation of their new culture without pinpointing the salaries of their leaders at the top.
In this way, the organizations move beyond the games and techniques used to acquire and use power, beyond dysfunction and conflict in relationships, and toward a workplace of trust, integrity and authentic, genuine relationships. In this new environment, the workplace culture becomes an asset and not a liability. People are able to trust that their leaders are doing their best to keep their organizations sailing smoothly, irrespective of the salaries that their top leaders, whose work may extend even when they are at home.
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Research essay sample on Paying Jobs Clear Picture
