Comments on: Who creates value in a firm? Is it the CEO? Lee Raymond thinks so.

By: Business Explained » Archives » Why gas prices are so high and oil companies enjoy record profits

Thu, 04 May 2006 14:43:36 +0000

[...] By the way, oil CEOs shouldn’t be paid for huge profits from supply price increases. That just rewards them for tightening supply and not investing in new energy sources! [...]

By: Stever’s Business Rants » Blog Archive » “The market will handle oil shortages.” It is. So quit bitching.

Thu, 04 May 2006 14:43:19 +0000

[...] Oddly, we pay oil executives as if they were actual players in a competitive market, instead of beneficiaries of huge tax breaks, near-monopolistic pricing, and tremendous government involvement in protecting this critical national resource. My oil profit blog post shows that an oil company can generate record profits just through normal supplier price increases. Aren’t the oil company execs happy that their stock options reward them hugely for such non-actions? [...]

By: Mridula

Mridula — Tue, 02 May 2006 09:51:47 +0000

I have read your articles in HBSWk (cannot afford subscribing to HBR) and have enjoyed them, particularly for the straight talk you do.

One wonders how things have come to this? I am at the good side of the outsourcing now, as I live in India but I for one can clearly see that many of these companies will move elsewhere, the only question is how long will it take, 20 years or 5?

By: Stever

Stever — Fri, 28 Apr 2006 19:47:05 +0000

I’ve always enjoyed contrasting corporate leaders with leaders in startups. No one requires $100MM of high-probability stock options to join a startup. The challenge, inherent passion in the business, and fun of running the job is the motivating factor. Yet for huge companies, we choose people who require nine figures’ worth of motivation to be persuaded to do the job. Bizarre.

By: Geoff Roberts

Geoff Roberts — Tue, 25 Apr 2006 07:57:03 +0000

Can these guys lose? It often seems as if the successful (whatever you might think of the causes of success) CEOs get big rewards and the unsuccessful ones get big payoffs (as compensation for breach of contract - whereas if some ‘lower’ employees fails to perform they just get sacked!).

I regard payments like this as one of the modern obscenities.

So, how do we get rid of the cult of the corporate leader? If these businesses that overpay their CEOs were ‘minor religions’ there would be media outpourings about how the head honcho was ripping off the members. So here we have head honchos ripping off employees and shareholders….