The Pessimist

You can't look at a newspaper without being inundated by tales of corporate greed. And the problem bears little resemblance to the fears expressed about globalization, corporate malfeasance or psychotic behaviour towards all stakeholders except shareholders.

The problem is much more personal. The biggest theives are CEOs, and the people they are stealing from are their shareholders.

Let's take a couple of recent examples.

The Canadian Centre for Policy Alternatives issued a press release that ran in the papers January 2nd: No New Year’s hangover for top CEOs
Seems the average annual compensation of the CEOs of the 100 largest Canadian companies is $10million. That sounds like a lot, right? But how much is it? Most of us don't have a real perspective on numbers that large, as they usually only appear in our lottery fantasies. So, the CCPA stated it in another way that makes the number a little easier to grasp: The average CEO had already made more by January 2nd then the average Canadian employee is going to make in the whole year.

Hydro One
Then there was Tom Parkinson, CEO of Hydro One, who last month got caught by the Auditor General with his hand in the cookie jar -- he was using his secretary's expense account to put through his own unauthorized personal expenses to the tune of $45,000. Now, the guy made $1.5million a year, so it is hard to understand why he needed to steal chump change like $45k. And he wouldn't be so dumb anyway, as his immediate predecessor Eleanor Clitheroe was fired for padding her expense account. So, the guy gets fired, right? No! He resigns; and he is immediately paid his full 3-year contract - another $3million !!

Where can I get a contract like that? He resigns because he faces embarassing accusations and he gets paid anyway? He'd be crazy not to steal the lunch money, or fuck the secretary, or use the company helicopter to fly him to his cottage -- anything to be relieved of the obligation to show up at the office everyday. How tiresome -- so much better to get two years pay and only sit around at the cottage all day doing no work at all. Unfortunately, ThePessimist believes Parkinson is probably only days away from landing another cushy multi-million dollar job so he can start the process all over again. Why do these people keep getting jobs at all?

The inner-communist in me is running his tin cup along my rib cage. What makes these people worth 150, 250, 500 times the worth of their average employee? Does he do hundreds of times more work than I do? Is his work worth hundreds of times mine? Sure the CEO's worth more than the average employee, maybe he even does more, and he should be paid more. But not hundreds of times more. Prior to the 1980's, the average multiplier was 40 times (and some people then thought that that was high). But with executive salaries, stock options and bonuses going through the roof in the last 15 years, 40 times looks parsimonious.

It is time to start bringing these salaries back down into reasonable ranges, or a revolution of some sort is going to have to follow.

Next