It turns out that there is No relationship whatsoever between a CEO pay and performance:With all the public chatter about exorbitant executive compensation and income inequality, it’s useful to look at the relationship between chief executive officer pay and corporate performance. Typically, when the subject of their big pay packages arises, CEOs—usually through their spokespeople—say they are paid for performance. Does data back that up?Actually, it's on the order of 1%, and certainly not worth it. (Click on the image for a better view of the trend line)
An analysis of compensation data publicly released by Equilar shows little correlation between CEO pay and company performance. Equilar ranked the salaries of 200 highly paid CEOs. When compared to metrics such as revenue, profitability, and stock return, the scattering of data looks pretty random, as though performance doesn’t matter. The comparison makes it look as if there is zero relationship between pay and performance.
The cult of the overpaid CEO has no basis in reality.
It's all a game where one hand washes the other.
Hoocoodanode?
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