Matthew Steeples suggests that ‘Fat Cat Friday’ is actually not such a bad thing
Today is branded ‘Fat Cat Friday’ by some in the UK. They moan that business chief executives of the top FTSE 100 companies will have received pay matching what an average worker will receive in the whole of 2019 and groan that this is “excessive.”
In the past, there was a time when business leaders were celebrated and saluted for creating jobs and generating wealth for our country but this morning on Sky News, Dr Faiza Shaheen of the Centre for Labour and Social Studies remarked: “All that is happening is that we are getting more and more angry… And nothing is done.”
This busybody then continued: “There is no one saying wait a minute and this is a group effort and money should be spread across all workers… Bosses have too much power and we need to put workers on boards… There is a huge amount of support to tax the rich more.”
Dr Shaheen – who pompously describes herself on Twitter as an “inequality geek… aiming to redesign the economic system to work for the many” – is entirely wrong and now, at a time when Britain is perilously at risk from Brexit, we need to encourage companies to recruit the best management possible and to celebrate their contribution to our economy. We will not achieve success by slashing the pay of those at the top just as we will not achieve success by slashing the pay of those at the bottom.
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I am not sure on this.
There are too many examples of mediocre CEO’s who don’t provide shareholders with a reasonable return and whose pay rises are rubber stamped by Non Execs on Remuneration Committees who don’t want to rock the boat as they too are generally getting overpaid. Much of the problem is that these CEO’s are envious of entrepreneurs who truly deserve what they get. So because they don’t have the balls to start a business try to make capital out of shareholders. The CE of Persimmon was a case in point. How on earth did he deserve £75 million?
I agree with Peter. All too often poor performance is outlandishly remunerated at the expense of ripped off shareholders, who are not only paying over inflated salaries to mediocre management but also suffering from the poor performance delivered. However Doctor Shaheen has clearly not been taking her pills, since often a FTSE 100 company CEO salary divided equally between the employees would increase the tea lady’s salary by a only a few pounds a week, whilst appointing a half wit to run the company on a pittance salary (perhaps Corbyn as CEO of Unilever?) would guarantee bankruptcy and the tea lady ultimately loosing her job.
We have seen far too often the frankly obscene salaries for under performing CEOs. Top twit Fred Goodwin springs to mind. He who had a thing for RBS and allowing his own ego to somehow grow the brand to dizzying heights only later for it to decend twice as quickly then forced into nationalisation and bailed out essentially and paid for by poor folk. He was later stripped of his Knighthood by the Queen no less. Yes. He was THAT good! Fair enough if they are brilliant and bring profit to a failing corporate. Then they are worth it.