Is There A Problem With Executive Compensation?

Executive compensation has become a controversial issue in recent years. Cases of CEOs leaving office with large sums of money while the companies they led were in financial difficulties are regularly covered by the media and presented as proof that there is a problem. More recently, the economic crisis and government rescue of failing firms with public funds has justified imposing caps to executive pay. An internal managerial decision which traditionally was of relevance only to the administrators and shareholders of a given company is now being debated as a policy of interest to the general public. Is there a problem with the way executive compensation is determined?

Links of interest

Media Release: Executive pay should be determined by a company’s shareholders and directors

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