[charlesdm]

I totally get what you're saying, it can definitely pull down morale across the engineering team. But it doesn't look like the CEO is interested in fixing the situation?

It can also create tricky situations if, for example, you're a two co-founder team. The CEO might be on good terms with the CTO about the vision of the company, and he needs his continued support/voting power coming with equity stake to push through that vision.

If they each own 30% then he'll be dead in the water without his co founders support if things ever get tough.