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Maximum Wage

A growing number of analysts are blaming the current economic crisis on excessive executive pay. In an article in the Summer 2009 Perspectives on Work magazine titled “The Corporate Pay Gap: Do We Need A Maximum Wage“, the author contends that the greater the potential reward, the greater the executive temptation to cut corners — [...]

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By Alice LaPlante STANFORD GRADUATE SCHOOL OF BUSINESS—Major accounting fraud aside, there are few business activities the news media seem to delight in exposing as much as excessive executive compensation. But recent research shows that these types of headlines might not make all that much difference in how corporations actually behave. “Say the press does [...]

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STANFORD GRADUATE SCHOOL OF BUSINESS—Offering incentive pay makes organizations perform better. Driving down product and wage costs is essential for success in low-margin businesses. Holding people accountable results in fewer screw-ups. All fundamental truths of business, right? Wrong, says Jeffrey Pfeffer. These are merely assumptions about what makes organizations competitive. Change your assumptions and you [...]

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STANFORD GRADUATE SCHOOL OF BUSINESS—What do Disney, AT&T, Exxon, and Verizon have in common? Based on economic performance and what they paid their CEOs from 1991-2002, a new academic study argues that all these firms were headed by CEOs who were paid too much. These firms, say the researchers, are among a group of companies [...]

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