Are U.S. CEOs overpaid Research Paper Example | Topics and Well Written Essays - 2000 words

Are U.S. CEOs overpaid - Research Paper ExampleEven if they did not occupy such(prenominal) positions, people with a firm educational background and effective leadership skills should be paid much more than the rest of the population. The publics exclaim is not entirely misguided nonetheless, there are facts supporting the high earnings entitled to the CEOs and it remains unclear whether capping CEO salaries will contribute to seam success. This paper explores whether US CEOs are overpaid. Statistics According to Kaplan, US CEOs are arguably overpaid (6). According to Walsh, some of the potential triggers of the excessive salaries of CEOs include too much influence, careless boards of directors, weak compensation consultants, and formulation of salary scales through stock options among others (73). According to Kay and Van Putten, in 1970, the amount Chief Executive Officer earned round $700,000 (189). The amount was 25 times the earning of an average production employee. Three decades later, CEO salaries had risen to al more or less $2.2 million, 90 times more than the salary of an average histrion (Kay, and Van Putten, 190). Kaplan argues that with an increase in the value of stocks and other allowance, the average CEO currently earns between 250-500 times the average employees salaries (7). ... Any employee in the engineering science industry is aware this average salary would hardly hire a well-educated administrative staff in technology-intensive sectors in the United States. According to doubting Thomas and Hill, current CEOs serve shorter terms compared to CEOs of the late twentieth century, hence the sharp rise in the earnings (19). The high rise in CEO salaries whitethorn be attributed to the fact that the officers are uncertain about what would happen next. Capitalism seems to have entered the corporate sector to the level that CEO may see it infract to earn as much as they can when in such positions (Kay, and Van Putten 191). According to Wal sh, todays CEOs are virtually carrying out the homogeneous duties as their predecessors who earned a much less, but this is not the case with line workers (75). Whereas, the salary gap between a top executive and the average employee calls for a review of the rules to narrow it, Kaplan argues that rectifying the discrepancy may not be achieved (6). Owing to the fact that CEO salaries top the list of salary scales in most organizations, theirs tend to be fodder to the media. Less widely covered is the substantial salary disparity between employees and junior executive remunerations. It differs by sector, but in most firms, the salary discrepancy becomes clear at the immediate CEO subordinates. At this point the analysts move into a lower pay level, but world-shaking disparities in salary still subsist between a senior executive and a CEO (Kay, and Van Putten 122-127). Relating the average worker pay to CEOs For easier perceptiveness of the salary scale of the average employee in t he US, it would be appropriate to analyze all aspects of their salary wage, shift gap,