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Is CEO Compensation Justified By Performance?

Is CEO Compensation Justified By Performance?

This report explores the issue of pay that top executives make, and if they are compensation by performance. After reading the section “ Is CEO Compensation Justified by Performance”, in the book Taking Sides. I would have to agree with Kevin J. Murphy, for the fact, chief executive officers are responsible for the success of a business and therefore deserve to be compensated. Top executives are under a lot of pressure being the chief executive officer (CEO) of a business and it is not an easy job. In addition, these top executives also have years of experience and education behind them. And when a board of directors set standards for chief executive officer (CEO), salary and incentives they have one thing on their mind, as they should. How qualified is this person and will they bring in a profit for the business and their shareholders. When setting up this package, there is no doubt, that their compensation is based by performance among other things. In particular, I found it amazing when I was researching this issue, that almost all the data available, compares top executive pay to that of a regular worker. I have tried to apply logical thinking to

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