It’s interesting firstly because of the ongoing debate about executive reward at the moment.
But what I wanted to focus on here, particularly given my recent post on Whole Foods, is the differential in pay between CEOs and average employees.
In general, the differential is quite a bit less that that described by John Mackey in his presentation on Conscious Capitalism – I presume because we’re looking at the UK rather than the US where the differential is presumably higher? It’s still a lot higher than Mackey’s recommendation of 19x though.
And the highest differential – for Bart Becht, CEO at Reckitt Benckiser - is 1374! (ie Becht gets paid 1374 times the amount (£37m) paid to Reckitt Beckiser’s average employee - £27k).
This clearly isn’t a great basis for effective up and down collaboration.
Mind you, Cisco CEO, John Chambers’, recent $2m under-performance bonus doesn’t seem to be affecting the way it’s becoming more collaborative.
I guess this is only one part of the equation…