The Buck-a-year Salary Smokescreen
When CEOs forgo a fat salary in exchange for equity, they align their wealth with the company’s success. But a new study suggests it’s often just a PR ploy.
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What’s the Latest Development?
The buck-a-year salary is a grand gesture by corporate chiefs usually intended to broadcast the CEO’s confidence in the future of the business. But a new study suggests it may also be a smokescreen—more a public relations stunt by the CEO than a sign they are a team player who wants to make a sacrifice for the good of the company.
What’s the Big Idea?
According to CNN Money, these self-abnegating chieftains often make up what they lose in salary by loading up on stock options. Meanwhile, in another of its articles, it says that regulators should “pay closer attention to the growing body of evidence that CEOs paid in stock and options are not any more likely to act in his or her company’s best interest.”
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