I've wondered this about CEOs. For the price of one Jamie Diamond you could hire the entire graduating class of Harvard Business School. Surely, between them, they could perform his duties, no?
Think you mean Jamie Dimon (JPMorgan) and my opinion is that they can't. They would likely lack the real-world experience to take highly important decisions under pressure. At that level it's not all science, knowing the right people and people skills in general are very important. His public appearances are quite good also, a very good speaker.
Blame autocorrect. But you get my point: doesn't have to be the HBS class; could be the HBS professors; or 100 bankers with 20-years experience each. Point being, there's got to be a better explanation for CEO pay than ROI on their services.
Sorry, didn't mean to be a grammar-nazi. I think their job means much more than meets the eye. The guy is directly lobby-ing the US president, and highly ranked officials around the world. Mistakes at that level cost quite a lot. It might be the case that some professors can be up for the job, but would anyone take a chance?
> Point being, there's got to be a better explanation for CEO pay than ROI on their services.
I'm not sure there is a better explanation for it for now.
Economists call this the principal-agent problem. When/if we figure out how to have public corporations without boards of directors who are scandalously traitorous to the common stock investor, most commerce will move to that new model.
They'd probably be less apt at directing the company to commit crimes, but I digress.
A large part of a CEO's job at such a big company is maintaining relationships especially with various regulatory agencies. There's no way a recent graduate could manage that.