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jbronn | 8 years ago

Because research has shown there’s an inverse correlation between CEO pay and company performance.¹

¹ https://online.wsj.com/public/resources/documents/CEOperform...

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LyndsySimon|8 years ago

That doesn't seem surprising at all - a CEO's reputation is tied to the reputation of their company, so it makes sense that a poorly-performing company would have to pay more to attract the same level of expertise as a well-performing one. If the poorly-performing company fails, then the CEO's market value will decrease. Higher compensation offsets that.