While we were talking about income inequality today, and the question of whether or not it's "right" or "fair", I thought of Ben and Jerry's, a company famous for its progressive business practices. One such measure was an income cap for the CEO of only a 7:1 ratio of the CEO's salary versus the lowest paid workers. This measure was rescinded after several failed attempt to fill in the shoes of retiring CEO Ben Cohen, because they could not find anyone well-qualified willing to accept such low pay (for a CEO). As a result, the company went from very profitable to actually losing money, so that it had to be bought out by multinational-firm Unilever.
While it may seem like CEO's make an exorbitant amount of money, this provides a clear example that these people deserve that money. How many of us could handle that pressure and know what to do running an entire company? It takes a special, 1 in a million type of person to hold such a job, and the demand for such personalities matched with the small "supply"/availability of them makes their jobs worth so much.
This is just a brief article about it:
http://www.cbsnews.com/8301-505123_162-42750506/occupy-wall-street-why-ben--jerrys-endorsement-rings-hollow/
Subscribe to:
Post Comments (Atom)
Interesting! I had no idea about any of this. The ratio does seem too low to be sustainable, but on the other hand it would seem that SOMEONE out there should have been able to take on the job at that rate of pay. It does show you, though, how powerful market forces are-- anyone who would have accepted the job at that salary would have been ridiculed by his/her counterparts for being such a sucker!
ReplyDeleteI had no idea that the wealthy themselves, could be so dependent on the money that they have! However, is it possible that the industry that Ben & Jerry's was in was struggling? If that is the case, than maybe a merge was a good thing for both companies, because their resources are put together to conquer the market.
ReplyDeleteThis really goes to show the amount of work that goes into being a CEO. Either the world has a shortage of qualified candidates for the position, which may be the case, or there just really aren't people out there who would be willing to receive that little income for the amount of work that they do. If there is a shortage of qualified applicants for CEO positions, then it would make sense that the few number of them that exist are competing for the highest paying positions and wouldn't "waste their time" with Ben and Jerry's.
ReplyDelete