An honorable member of the Coffee Shop Has Just Posted the Following:
One study says top corporate salaries are a scam game, another that “executive managers’ pay is still determined by simplistic measures of performance that bear little relation to long-term drivers of companies’ value, according to an analysis of pay at FTSE 100 companies over the past decade”.
If so so how can our ministers’ salaries that are pegged to private sector pay be “reasonable”? Private sector salaries are “rigged”, not the result of rationality or even supply and demand..
How the salaries of top corporate executives are calculated is a scam according to the Economist, citing an academic study. (The Economist advocates things like GST, low income and corporate taxes, minimal welfare and charging owners who use their cars. All very PAP. I’ve called it the PAP’s bible.)
So the u/m is relevant in the light of PM’s comments about “reasonable”* salaries for ministers. (What do you think?)
You will be shocked, shocked to learn that your worst suspicions are confirmed. Yes, firms that hire pay consultants pay their executives 7.5% more than those who don’t. Yes, companies that hung on to their multi-service consultants paid their executives 10% less than those that switched to specialist consultants. Executives who work at firms where the board hired the consultants earned 13% less than when the consultants were hired by the management themselves. When executives get a big pay rise, their companies are less likely to replace their consultants in the following year.
The authors conclude that
our study finds strong empirical evidence for the hiring of compensation consultants as a justification device for higher executive pay.
So, be very suspicious of arguments that higher executive pay is the result of the “war for talent”, the unique importance of the CEO in a globalised world, or whatever. If such arguments were true, it should make no difference whether consultants are hired or not. This smacks more of the famous lickspittle courtier of Louis XIV, the Sun King, who, when asked the time, replied “It is whatever time your majesty pleases”. “Whatever pay your majesty pleases” is the modern equivalent...
https://atans1.wordpress.com/2014/12...civic-service/
Click here to view the whole thread at www.sammyboy.com.
30-12-2014, 01:10 PM
Why MIW hired "CONsultants" to recommend salary levels
