CEOs suck

A few months ago, my wife and I received a notice from our car insurance company about a name change. Gone was 21st Century Insurance; the company’s new (well, adopted) nom de guerre was AIG. I admit, I hadn’t really heard of AIG before, but soon discovered two things. 1) AIG is gargantuan; and 2) AIG was one of those companies in need of a bailout. And, oh yes, this little item in the news about AIG executives’ fun-filled, $440,000 trip to a California resort one week after AIG received $85 billion in bailout money.

Just the other day, we received another notice that, henceforth, our AIG car insurance company will no longer be called AIG, but will be called, instead, by a trusted, proven name brand. And that name is…wait for it…21st Century Insurance.

Ah, a corpse by any other name – would stink just as bad.

Do you get the impression that CEOs have an overinflated sense of entitlement? And do you get the feeling they think we’re unpleasant and odourous stains on the bottom of their shoes? Here’s some perspective:
The chief executive officers of large U.S. companies averaged $10.8 million in total compensation in 2006, more than 364 times the pay of the average U.S. worker, according to the latest survey by the United for a Fair Economy.
364 times the pay of the average US worker.

It’s not entirely surprising, though, that CEO salaries have reach aristocratic proportions. After all, CEOs and upper management are very much the modern, corporate incarnation of the aristocrats of yore, and this is a direct consequence of how we conceive the organization of labour in a company. The dominant metaphor is the ladder, more precisely the pyramid. Workers at the bottom, some management in the middle, and senior executives headed by a grand poobah at the top. Implied is a hierarchy not only of job function – upper levels oversee lower levers – but of status. The further up you are, the greater the exclusivity of your position, the better the status. Naturally, with this comes the view of the company as some sort of fiefdom, with the poobah feeling entitled to all the riches and luxuries. Unfortunately, this entitlement has led to the view that CEOs can reap the rewards for sailing the company ship to golden lands without being left to drown if they sink the boat. That life preserver? Yup; it’s made of money. And this is class warfare, pitting the employers versus the employees.

Yet this is the wrong way to look at it, because when it comes down to it, a company would fail without its workers. A CEO can’t be CEO of nothing. Similarly, workers can’t necessarily work towards a common goal without the assistance of someone to coordinate all the tasks and activities necessary to achieve that goal. In other words, the hierarchy is not really a pyramid or a ladder, but a concentric circle (or web of networked nodes) on the same level.

I suppose it’s a capitalistic attitude that views business through a competitive paradigm – hence clawing and scratching your way to the top – rather than a cooperative paradigm in which workers are valued on equal terms with the CEO, as partners working jointly towards the company’s success. Until we reform our corporate culture – a Sisyphean task, perhaps, dependent on reforming our views of capitalism itself – we shouldn’t be surprised that CEOs misbehave to further their own self-interest that, in all fairness, should be called what it is: greed.


Nick said...

To me this whole bail out thing of these companies is ridiculous. I understand the purpose behind it as a way of keeping jobs but let's look at the reality. CEOs are still making big bucks in a time where people are losing jobs by the thousands. How about they offer to take a pay cut? That would be impressive wouldn't it? Do they really need that millions of dollars to keep living? How about they be partially to blame for the problems that exist now? Especially those in the banking industry? Those of the golden handshakes who get paid out by shareholders money and then go somewhere else to continue making the same amount of money or more? If we are truly in a crisis then it should be one felt by all. CEOs don't deserve the money they make and nothing I've seen in the working years of my life and the news I see on TV makes me feel any different. It is all about status, nothing more. The rich are rich the rest are struggling. End of story. Things need to change drastically.

Frederik Sisa said...

You speak for us all, Nick ol' buddy.