The rapid rise in pay for corporate executive officers, which stands in contrast to the stagnant wages of many Americans, is a key driver of inequality that’s not clearly tied to talent or performance, a new report from a liberal think tank finds. The Economic Policy Institute report says this means CEO pay could be reduced without hurting economic growth or productivity. EPI says top U.S. CEOs make 300 times more than typical American workers, down from a peak of 376 times in 2000 but well above levels seen in the preceding four decades....if CEOs “were paid less there would be no loss of productivity or output.” [WSJ]
Compensation Watch: It Sucked Slightly Less To Be Brian Moynihan Last Year
No cash bonus to speak of, but the li'l fella did get a bump year on year.
Vikram Pandit Is Committed To Getting Paid
If you didn't know Chief Executive Officer Vikram Pandit, you might think he enjoyed not being compensated for the work he does at Citigroup because for quite some time, he wasn't. And although the "I will only get paid $1/year until Citi turns a profit" exercise was fun for a while, he was pretty happy when the old jalopy started making money again, in part because it meant he could receive a paycheck. Then last April, his shareholders rejected the bank's executive pay plan, claiming the Big C "lets Chief Executive Officer Vikram Pandit collect millions of dollars in rewards too easily." And while it's possible that Citi shareholders are just a bunch of pricks who chose to overlook the fact that Uncle Vikula didn't collect squat for several years and once had an entire article written about the fact that lieutenants attributed a "new bounce in his step" to him daydreaming "the day when he is going to earn more than a $1 a year,” maybe they just assume that he doesn't care about getting paid either way? Anyway, here's Vickles, reminding anyone who forgot about the sacrifices he made and setting the record straight: “The board has this process with them, they’re going through it, and they are committed, as I am, to making sure that they resolve this,” Pandit said. “I want to get paid what the board thinks is right for me, for the job that I’ve done and for the incentives that they think I ought to have.” Pandit told lawmakers in 2009 that he would take a $1 annual salary until he restored the bank to profitability. Citigroup made a $21.7 billion profit for 2011 and 2010 combined, compared with a $29.3 billion loss for the two preceding years. “When the company was losing money, I stepped up and said I’ll take a dollar a year and I did, exactly for that reason, exactly the right thing to do,” Pandit said. For those having trouble separating the nice guy/don't want to offend anyone statement from what he's actually trying to say, a rough translation of the above would be: get me paid, bitch! Citigroup Will Resolve CEO Pay By End Of Year, Pandit Says [Bloomberg]
Bonus Watch '14: Bank of America CEOs (Make Less Than Their Underlings)
...which has got to hurt.