The following is a lightly edited transcript of remarks made by Ellis Henican during a Newsweek podcast debate on CEO pay. You can listen to the podcast here:
It's a bit of a mushy concept and there isn't any general agreement on exactly what the test of fairness is. But, I think it's important before we dive in, to try and broaden it out a little bit. So yes, one question is, are these huge compensations packages fair—what is it doing to us as a society? Are they necessary? Are they looking after the interests of shareholders, consumers and employees? Finally, even if we decide we hate them, what are we going to do about them? What are some practical ways that we can try and rein these things in and get something closer to whatever that elusive concept of fairness is? To me, that's the tough and interesting parts of this conversation.
There are lots of things we can do. The tax code gives us pretty good tool to work with. We can empower shareholders, who have some role on this. We can try and spur boards of directors to quit being lapdogs to the domineering opinions of management. So sure, there are a whole lot of tools at our disposal, if we want to use them. But, I think Alice is correct to start out with the question of where are we trying to get. What are these people worth? Do we really have to pay them that much? And frankly, my belief is that the game is rigged—that the system is set up in such a way that nobody is currently effectively asking those questions.
Ellis Henican is a New York Times-bestselling author and Pulitzer Prize-winning columnist.
The views expressed in this article are the writer's own.
