[ajsharp]

If CEOs were as replaceable and disconnected from the outcome of a business as the author suggests, boards would've started doing this long ago and CEO salaries would come down as a result (lots of people want to be CEOs, and by this author's logic, virtually anyone can do it). This is so disconnected from reality it reads like satire.

[kristopolous]

They replace C-level people often and the relationship isn't what you imply.

There's a structural power relationship in play. Monarchs play a fairly unimportant role these days but many countries still have them and compensate them handsomely.

CEOs are structurally capitalist monarchs. Sometimes it's even a hereditary position. They even do the corporate equivalent of court and heraldry stuff.

They're compensated not based on competency but instead, like every other job, via social arrangement.

If you don't think that's how salaries work, you're getting underpaid.

[candiddevmike]

Most corporate structures are feudal. Folks should refer to their VPs as the Duke/Duchess of Engineering.

[pydry]

C level meritocracy mythmaking is today's answer to the divine right of monarchs.

Court politics and C level politics are functionally very similar too.

[golergka]

> Monarchs play a fairly unimportant rol

It may look like that, but it's not true. You know how a good system administrator doesn't seem that important because he prevents all the fires that a bad one would heroically put out? The mere presence of a monarch, not even his actions, acts in a similar fashion. They don't have to actively govern the country, but they have emergency powers that would allow them to prevent a wanna be populist dictator. And because of obvious game theory implications, these powers never have to be used — their mere existence, and everybody bring aware of their existence, is enough for deterrence.

[EliRivers]

Would they? I understand that in many cases, CEOs are often selected by, and their remuneration awarded by, boards made up of incestuous groupings of people who rely on each other in the same way. Their incentive is to award big paydays to each other.

Do you have any evidence that boards would not do this?

[andsoitis]

> I understand that in many cases, CEOs are often selected by, and their remuneration awarded by, boards made up of incestuous groupings of people who rely on each other in the same way.

Can you give one or two examples?

[JumpinJack_Cash]

> > lots of people want to be CEOs

Lots of people want to be CEO (until they become CEO and until they make CEO kind of money)

By the first 3 months reality sets in and the person now in the CEO role understands that they are so far removed from the action that they are essentially relegated to the role of spokeperson and cheerleader, at maximum the role of general moving imaginary troops on a fictional battlefield.

If they can make peace with their role of political spokeperson and cheerleader they'd bail out as soon as they reach 5M net worth no debt. No less than 95% would bail out.

The remaining 5% would bail out once they reach 10M net worth no debt.

CEOs turnover and population is so low because it takes a special kind of monodimensional individual to have the world as your oyster 5-10M in your name and no debt and turn around and say "I'd rather go to work and pretend to be at the helm of an imaginary ship instead"

[misja111]

> .. boards would've started doing this long ago ..

You are assuming here that boards are always acting in the best interest of the share holders. I bet there are many who do, but there are at least as many that act primarily in the interest of themselves. Board membership is a lucrative job without much supervision, if any at all. So nothing is keeping board members from taking it easy. Why rock the boat if this can make you known as difficult? You might not get that 2nd or 3rd board membership then anymore.

You might remember Credit Suisse, the major bank that had to be taken over recently by UBS to avoid bankruptcy: until then it had gone from scandal to scandal for 15 years in a row. 2 CEO's had been sent away in that period (by shareholders) but the president of the board? He could stay, and with him the rest of the board. His salary? 7 million a year.

[roflyear]

Yeah because the CEO who happens to be the founders son is also the best person in the world to do the job. Give me a break!

[boringg]

I mean i think you could probably argue the long tail of poor performing small simple companies that sell widgets you might be able to automate a chunk of tasks. Thats as far as I would be willing to go. Other than that its a dishonest or uneducated argument.

[brqxc]

The real world does not work like that. If you studied at the right institution or your family knows the right people, you will get the right positions.

The whole purpose of title inflation is to direct money to your friends with plausible deniability.

Now someone will bring up the rare cases where a CEO actually did something. That does not disprove the rule.