[throwaway202303]

Quite a lot I would say. A CEO is making daily decisions, any one of which could be be the start of a company’s death spiral that results in tens of thousands of job losses. The amount of leverage they have over a company dwarfs that of any other individual worker. Besides what should I care what they earn if they pay me well for what I do, relative to the market? This is lazy, greedy socialist thinking where they want money for nothing’s

[rurp]

CEOs have a lot of leverage, yes, but how do I know that a particular CEO is making good decisions? If we look at a random CEO who is making XX,000,000/year, can you make an evidence based case that they are providing millions of dollars worth of value over a replacement level manager? I'm genuinely interested to know if there is a meaningful way to demonstrate this, because I have looked and haven't found one.

[UncleEntity]

> …but how do I know that a particular CEO is making good decisions?

We used to call that “profit”.

As a measurement over time at how well a business is performing this used to be the standard measurement but it seems to have been supplanted by other measures such as wealth inequity and twitter mob ragefests.

[somsak2]

bezos was a shit CEO for two decades and then somehow fell into a bunch of profit out of nowhere!

[WalterBright]

Apple had 5 failing CEOs in a row before Steve Jobs. Then look what happened.

[lumost]

From an investment standpoint, could you predict Steve Jobs would be successful?

[WalterBright]

His performance with Pixar - taking it also from near bankruptcy to enormous success.

[bradjohnson]

The visible decisions that I've seen attributed to CEOs range from "absurdly and obviously bad" to "good, until you find out the same decisions are already echoing throughout the industry". It begs the question did they come up with it themselves? Or did they just happen to hear rumblings before the grunts did?

I would argue that an above average CEO has a negligible effect on the company and an average one actively damages the company. The good ones make the decisions that everyone copies shortly after. We could probably replace >90% of them with AI and be better off.

[WalterBright]

If you're right, start your own company and put ChatGPT in charge of it.

[JimBright]

Perfect!

[wpietri]

CEOs are also the ones setting things up so that everything important is in the hands of the CEO, which just happens to justify their spiraling pay. Can you imagine if we ran countries that way? The president/emperor/whatever keeps hoovering up more power, which then justifies giving them more and more of the wealth?

Capitalists talk a lot about the power of marketplaces, but internally companies are little feudal empires with ongoing wars of succession. And as The Economist points out, actual marketplace competition is in decline, so there's little in the way of external checks. Especially given that CEO tenure has dropped dramatically, meaning that the correlation between CEO pay and CEO value delivery has also dropped.