[HN Gopher] CEOs' pay climbed before layoffs at tech giants like... ___________________________________________________________________ CEOs' pay climbed before layoffs at tech giants like Alphabet and Microsoft Author : pg_1234 Score : 64 points Date : 2023-08-05 21:21 UTC (1 hours ago) (HTM) web link (southernillinoisnow.com) (TXT) w3m dump (southernillinoisnow.com) | nine_zeros wrote: | CEOs pay is tied to the stock price. They will do whatever it | takes to boost the stock price, until they are out with a golden | parachute. From their perspective, the business is all about | boosting the stock price. It doesn't matter if the boost comes | from innovation, or from polluting the planet, or from | unscrupulous addictive practices, or from culling the employees. | | Employees are merely, an often undesired, side-effect in the | business of boosting stock prices. | mjevans wrote: | Executive stock prices should vest at the first of 25 years | from the date earned or 10 years after they've left the | company. That would encourage long term strategies rather than | pump and dump. | spacemanspiff01 wrote: | [dead] | nine_zeros wrote: | That would certainly be one way of attaining long term | vision. | | But who will enforce this requirement? Only pension funds and | other large shareholders have any (and often impractical) | leverage over the board C-suite. Wall-street shareholders | demand faster growth until they themselves can exit out. They | don't care about the business or the services or the | employees. They want a high growth return, year-over-year | until their own investment carry continues to exist. | toomuchtodo wrote: | Stock buybacks used to be illegal. Lots of ways to use | policy to encourage long-term shareholder value if boards | and corporate bylaws won't. | nine_zeros wrote: | Stock buyback is equivalent to paying a dividend. If | stock buybacks are prevented, companies will continue to | layoff and pay out dividends. It doesn't solve the root | cause that employees don't have a seat at the decision- | making table. | | At a minimum, if corporation laws were modified such that | every laid off employee must be issued 1 year worth of | shares as a golden parachute, the incentives will all get | aligned very quickly and employees will not be abruptly | thrown away. | s1artibartfast wrote: | Stock BuyBacks have nothing to do with long or short-term | vision. | kqr2 wrote: | Some companies such as Toyota supposedly have 100 year | business plans: | | http://www.gongol.com/research/economics/100yearplans/ | kccqzy wrote: | And frankly layoffs had almost no effect on their stock prices. | Announcing new products, even if quite half-baked AI efforts, | had much bigger impact on stock prices than layoffs. | henry2023 wrote: | Ask facebook | mertd wrote: | Meta stock performance is not really attributable to | layoffs. | madballster wrote: | That is a very narrow and frankly sweepingly incorrect | description of "CEOs" or "companies". They're not all the same. | I for one (alongside many other investors) carefully study | incentive programs and compensation oversight executed by the | board of directors. There are many thoughtful companies (and | CEOs) who e.g. align over very long-term targets, such as '5 | year return on capital". Investors have found out a long time | ago that incentivizing by short-term measures such as share | price (or revenues, or EPS) can bring about very adverse long- | term investing outcomes. | ChuckMcM wrote: | And if you make them subject to "alternative minimum tax" where | their stock based compensation is considered regular income for | the year it is awarded based on the difference between the | strike price and the market price, you "moderate" that process | somewhat. | | But if you're a politician and your donors are all rich elites | who really hated that aspect of AMT you get repeal it for them: | https://www.bowlesrice.com/tax-cuts-and-jobs-act-2018-change... | sjs7007 wrote: | > compensation is considered regular income for the year it | is awarded based on the difference between the strike price | and the market price | | Isn't that exactly how it works? Your grant price just | determines your number of your shares. When your shares vest | they get taxed as regular income for the entirety of the vest | amount. | s1artibartfast wrote: | I disagree with pretty much everything you say except this. | | >Employees are merely, an often undesired, side-effect in the | business of boosting stock prices. | | Employees are worse than a side effect, they're a cost center | to be avoided if possible. You want to achieve your goals with | as few employees as possible. | tootie wrote: | Employees do work and that work is meant to be profitable. If | it is, then great. More employees, more profit. If it isn't, | they get cut. That's exactly what CEOs are responsible for | determining. | silverkiwi wrote: | Deciding to layoff or not is a complex decision. Here the article | only looks at Companies that did layoff. Although more difficult, | would be interesting to also look at companies that also made | this decision and decided not to layoff. Essentially widening the | group of Companies evaluated to one step before the layoffs/no | layoffs decision is made. | lock-the-spock wrote: | Is there really such a thing as to non-decide? This seems to me | a pretty impossible study to do. | behringer wrote: | I'm reminded of the song by Christy Moore about being laid off: | | It seems to me such a cruel irony / | | He's richer now then he ever was before / | | And now my cheque is spent, I can't afford the rent / | | There's one law for the rich, one law for the poor / | taberiand wrote: | The law, in its majestic equality, forbids rich and poor alike | to sleep under bridges, to beg in the streets, and to steal | their bread. | | - Anatole France | jtode wrote: | It's become tiresome, reading things that pretend this is not | business as usual. | gumballindie wrote: | Water is wet. | gkoberger wrote: | I guess I don't get the point of articles like this. | | Yeah, we live in a society where all we value is growth. If the | company grows, the person who grows it gets more money as a | reward. The nameless investors (known as "The Market") all demand | more money.. even the employees want growth so their equity is | worth more. There's no limit to the growth; there's no Good | Enough. There's always more to grow. There's literally no | incentives for anyone, from employee to investor to CEO, to do | anything but maximize growth. And you can't just grow linearly... | as the base valuation grows, to maintain a target percentage the | growth itself has to grow. So anything less than growing the | growth is a failure. | | It's exhausting and never-ending, but every single one of us is | culpable to some degree. We all want our 401ks to get bigger and | our house to be worth more than when we bought it. There needs to | be a much bigger shift in society, otherwise yeah, this is what | happens. | | It's so depressing. But my point is... this is a symptom of a | much bigger mindset we have, mainly in America. And while that | mindset has brought us great things, it's also left every single | one of us on an infinite treadmill. You can't win at capitalism; | every milestone is fleeting in the name of more growth. ___________________________________________________________________ (page generated 2023-08-05 23:00 UTC)