Exactly. My main problem is that the CEO's stance is entirely hypocritical, because he would demand real equity or quit (probably even faster) if he was in the employee's position.
Once you have access to millions in funding its tough to see people who have to work for a living as human just like you. You expect them to lovingly accept terms that you would be insulted at.
Now if your talent is so great that you dwarf all your employees it might be justified. But when you are pained at losing productive workers chances are your favorable terms exist mostly because of your connections.
His entire argument is that the company must retain power in employee relationships, never the employee.
If one non-manager employee is ever in a position to show other employees they are being undervalued, the employees may do something stupid like demand the company fix the situation. Can't have uppity employees. Employees exist to be subservient to the ever-changing, unanswerable will of the CEO, not set the rules themselves.
The CEO gets to fail upward and become investor-class while shitting downwards on lowly employees who would dare to try and be paid what they are worth. How dare they attempt to confront such holy and monied highness as a CEO. Know your place, employee.
Sorry, I meant it to mean that the CEO represents the interests of the employees in that the employees do well as the company does well. Yeah, they get less of the yield than those at the top, but if the company isn't doing well it puts downward pressure on all of their careers. Presumably the employees are there because they support, or are at least neutral, to the goals of the company, and thus share an interest. If they oppose the goals of the business, while I can understand why they might take a job there, I would still argue it's an ethical lapse.
Doesn't sound like the CEOs problem; he isn't there to make personal sacrifices to make the company profitable and I don't think anyone would pretend he is. If anyone should be making that observation it is whoever signs off on his compensation.
Although the compensation package won't cash so the situation isn't quite that simple.
If we're talking about pay structure and access to the executive washroom, then no.
If we're talking about employees and the CEO having equity in the same company but the CEO can cash his equity any time he feels like it while the employees cannot then there's a problem. Especially when said CEO seems to be doing questionable things to pump up the value of his stock that later collapses so that when employees finally can get money there's no money to be had.
I find it disturbing that you seem to think there's nothing wrong in this situation. There's no way you can say that the actions and behaviors of this CEO and company are the norm. If you don't understand that at this point then I'm unable to explain it to you. In this case we'll just leave it with you have your opinion and I have mine.
I think some of the resentment comes from "Golden Parachutes" too. While it's stupid for the Board to allow a contract where the CEO get $X million even if they run the company into the ground, the CEO that runs the company into the ground bears some responsibility too.
So CEO's are supposed to be magical super-rare humans who do nothing but are worth 1000s of regular workers and take all credit for good returns...
Until things go bad and then it's all the worker's fault! The ship was too big to steer!
If CEOs are worth as much as they think they are then they should have no problems taking all of their comp in stock, and bonuses (if any!) should be handcuffed to hard goals.
In this case we really aren't talking about a cut and dry example of putting workers over shareholders. The company has seen significant increases in value over time. It's a pretty difficult sell to say a CEO is hurting the company while also creating as much value as he was for the shareholders. These are boardroom disputes not courtroom disputes.
I think it’s reasonable not to allow a single employee to be compensated (55b$) more than all the EBITDA the company has ever made.
I think it’s reasonable to question the decision making demonstrated by firing the most successful team at the company and put the major competitive advantage at risk.
I think it’s reasonable to question the constant monkeying with product and design (Cybertruck, removal of loved features like LIDAR or physical wiper blade controls).
I think it’s reasonable to question how the CEO has lost first mover advantage so badly by failing to improve products and introduce new models as the legacy competition and foreign companies quickly have caught up.
I think it’s reasonable to want an engaged, full-time CEO who is not distracted by executive responsibilities at several other ventures, half of which are actively failing as well.
> Which CEO would be more likely to get you to make personal sacrifices:
The thing is, the sacrifices demanded of employees by their employers are often non-negotiable, so it doesn't really matter either way. If you're a factory floor worker, you are not "tremendously valuable to the future of the company," your value to the company is specified to the penny and it's likely much less than the value of the equipment you're operating.
The billionaire who can destroy your livelihood on a whim sleeping on the factory floor doesn't really change anything for you the worker.
Are the workers' salaries competitive? How good is their insurance? Will they be expected to put in arbitrary blocks of six day, twelve hour shifts or can they reasonably have a life outside work? How accommodating is the company with school, maternity leave, lateral training? What is the company's history of harassment, OSHA violations, etc? These things matter. Pointless shows of solidarity and "empathy" really don't.
I think the notion of a CEO doing all the things their workers do purely out of solidarity to be shallow and condescending. Obviously his job is different from theirs and he is going to have a different set of rules. And I doubt any of them would want to put in the number of hours he puts in. He's clearly a workaholic.
He's compensate to maximize shareholder returns, not to keep people in a job. The people are employed for the same reason and when their RoI is below the threshold then you need to right the ship. This is what a CEO is partly there to do.
During the early phase of a company the goal is growth. Hire. Scale. Build. Win the land grab at all costs.
Years later when growth has slowed it becomes important to transition to operational efficiency. For many startups that means lowering headcount some just from attrition, but right now it seems layoffs is in style to accelerate the transition.
Regardless, investors pushed the CEO to grow fast. Under the current model it isn't fair to punish the CEO for executing on their mandate. I acknowledge it isn't fair to the employees either. Just offering a different perspective.
Why should the financial gains of the company be completely disconnected from how it treats the people it employs? There is a perverse lack of incentive for people at the top to be good to people at the bottom.
If a CEO is rewarded handsomely for tricking / deceiving a large population of his employees (at the expense of the employees, benefit enjoyed exclusively by company) should this now be seen as an accepted business practice? How slippery do we have to get this slope before it just turns into a meat grinder where all issues ethical or otherwise uncomfortable are just hand-waved away into "but it's profitable!" sausage?
That's a bit of a leap. The argument is that the pain should be felt at the top as well as the bottom, as a function of the state of the company. The least execs could do is try to appear as if they're working to keep people's livelihoods intact. They could signal this in a number of ways, but it's a matter beyond an irrational sense of fairness; if the execs don't have to sacrifice anything at all, is the company really in such dire straits that employment has to be disrupted for the most vulnerable parts of the org?
Right but this makes no sense except as some weird punishment thing. Like it seems it would be the same to you if they still fired all 250 employees but also cut the CEOs salary as a slap on the wrist.
Like this stance is crazy if you apply it to anyone but the CEO. Can you imagine if you got punished for writing bad code or not making a project deadline by having your salary cut?
Regardless of whether you think she's doing a good job as the CEO, she's still doing her job and deserves to be paid. Your just asking for CEOs to be company whipping boys.
Is the worlds richest man expected to support a company’s billion dollar burn rate out of pocket?
Everyone has been aware for months that the business would get gutted. The business remains at risk of bankruptcy.
These are employees and contractors, they are not a charity case.
And to also assume they are “less well off” is to suggest that they are somehow poor, disabled, or lack the personal agency to find a new role rather than stay with a company that has been open about downsizing. They’re not Elon’s dependents.
If we’re going to go down that road we might as well count how many janitors HP fired today, and how the CEO should have personally kept them on salary.
Once you have access to millions in funding its tough to see people who have to work for a living as human just like you. You expect them to lovingly accept terms that you would be insulted at.
Now if your talent is so great that you dwarf all your employees it might be justified. But when you are pained at losing productive workers chances are your favorable terms exist mostly because of your connections.
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