The level of executive pay has skyrocketed over the past several decades, wideni

Question

The level of executive pay has skyrocketed over the past several decades, widening the gap between the compensation of CEOs and that of typical organizational employees. Although there exists a traditional underlying rationale for highly paid executives within the corporate community, the business validity of high CEO pay is coming under increasing scrutiny.” I find it very ridiculous that the average executive gets paid about 180 times the amount of his/her workers underneath them. They are obviously not doing 180 times for work, but the level of importance in their work is the most important job of them all. I am not saying that the other jobs are not important because obviously every job within a company serves a purpose that will lead to the business's success. Last week I talked a little about this topic and my main argument was "it's all about who you know" and if you know people that can get you into a position to make something out of yourself, that is using your resources to be successful and nobody should be able to take that away from you. I do still agree with that; however, the more I think about this topic, the more I feel for the workers who work their butts off for the executive and they are making 180 times less compensation than him/her. That would be very frustrating as a lower level employee. No matter what type of college degree or how smart/experienced the executive is, there is no way that he/she is 180 times more valuable to the company than the lower level workers. I now believe that the wealth of the company should be distributed a little better than how it is right now. Some executives make more money in a week than a lower level worker will make in a year. That is unbelievable! Do you believe that the executive job is that much more important than other roles in the company? How do you think you would feel if you were one of the lower level workers and found out that the executive of your company made more money than you in one week than you will make in a year?

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Explanation / Answer

I do believe that CEO job is important than other roles in the company. But the pay offered to the CEO is insane that any importance of the role cannot justify it. Although CEO role is important in making key decisions and implementing them for a company, no company can move a step ahead without its workers. Workers do work hard all day similar to any other executive in the organization. Its disturbing thought that someone(executive) gets paid 180 times more than what they get paid for the same amount of work. In the case given above, its 180 times but there are scenarios where pays of CEO's are 500 times and 900 times of their workers. The issue is not anymore only about CEO pay, it has turned out to be growing economic inequality. Any amount of importance of a role cannot validate this pay disparity amongst employees and CEO's. Because of the responsibility and hierarchal level of the CEO role, it's valid that he is paid higher... but here comes the question... How much higher? Is there any limit for that pay? What is the maximum or corresponding ratio for other employees average pay? The answer is no as there are no regulations or limits on the executive pay. There must be policy changes where tax rates should be increased on executive pays and taxes should be levied on executive performance pay. A limit of CEO to worker compensation ratio should be fixed and taken care that if this limit is crossed there are certain action taken. Above all these controlling measures, the board which decides CEO's should be sensible and should not go overboard on CEO pays. Board must realize that CEO is a part of the organization same as the other workers.

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