Globo Gym Purple Cobras

1
Globo Gym Purple Cobras

• Matt

• Isa

• Renee

• Julie

• Seth

• Alan

• Andre

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Outline

• CEO Definition
• Educational Background
• Responsibilities
• Rigors and Disadvantages
• The American Foundation Capitalism
• Liabilities

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• Wikipedia.com defines CEO as the highest ranking
  officer within a company or corporation, who has
  responsibility for over-all management of its
  day-to-day affairs under the supervision of the
  board of directors.

Left CEO of Capital One Financial Richard D.
Fairbank (source http//www.itpaa.org/modules.php
?nameContentpashowpagepid11) Right Former
Paramount CEO Sherry Lansing (source
http//www.thenoelfoundation.org/honorees.html)
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Forbes magazine ranks John Bucksbaum as the 1
CEO ( General Growth Properties) who delivered
the most value to its firm. Over the past 6 years
John has been paid a modest 624,000 a year while
delivering a 37 annual return to shareholders.
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• The average American CEO received about 10.9
  million in compensation in 2005.

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Educational Background

• Many of the CEOs are MBA or DBA educated with
  qualified accountants such as CPA, CA, or ACCA
  qualification.
• Advanced degrees are from the top universities in
  the country or elsewhere in the world.
• MBA program at Stanford is 40 thousand per year
  for tuition.

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Educational Background

• The percentage of all SP 500 CEOs who have an
  M.B.A. has increased from 37 to 39 over the
  past two years.
• 62 of all SP 500 CEOs have earned some type of
  advanced degree (M.B.A., masters, Law degree,
  doctorate, etc.).

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Educational Background

• Most Common Undergraduate Universities (by SP
  500 category)
• SP 500 Group Most Common University
• 1-100 Harvard, Stanford, Yale, U. of North
  Carolina - 3 each
• 101-200 Harvard, Stanford 4 each
• 201-300 Rutgers 4
• 301-400 U. of Wisconsin 4
• 401-500 U. of Wisconsin 4

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Responsibilities Liabilities

• Responsible for the success or failure of the
  company.
• Responsible for
• Operations
• Marketing
• Strategy
• Financing
• Creation of company culture
• Human resources
• Hiring
• Firing
• Compliance with safety regulations
• Sales
• Public relations

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Rigors and Disadvantages

• 70 hours per week
• High stress level
• Low job security
• Average tenure for a CEO is four years

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The American Foundation

• Leaders
• Capitalism competitive free market
• regulations cannot be justified
• Board of directors appoint
• Incentives

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• Are American CEOs overpaid?

NO!
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Question 1

• How can you justify a ceiling on CEOs salaries
  when it goes against what America is all about,
  free market capitalism?

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Question 2

• If you held an equity position and shared
  ownership in a company, how would you accurately
  compensate a CEO for his/her leadership skills,
  stress levels, education background, the amount
  of responsibility, and risks they endure?

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Closing Arguments

• Take into account how much the top 50 companies
  earn.
• How well did the Fortune 50 do?
• 64.2 billion in revenue.
• While the CEOs on average a top 50 CEO made
  0.016 of the revenue.

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Closing Arguments

• CEO pay is not entirely out of whack!
• CEOs and companies tend to make a lot of money
  but they also tend to
• Employ a lot of people
• Pay a lot in taxes
• Donate to Charities

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Closing Arguments

• How do executive salaries compare to those of pro
  athletes?
• The problem behind the current NHL lockout, for
  example, is that the players were getting an
  obscene percentage of the league's total revenues
  -- nearly 75
• The salary of any employee in a private company
  is none of your business. They have every right
  to be compensated in anyway the management or
  board of the company chooses.

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• CEO's are normally paid for their results
• They are responsible for shareholder profit.
• The companies success or failure hinges on the
  CEO's ability to attract the best people.

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Liabilities

• CEOs are liable for crimes they commit, aid or
  abet, and for crimes they fail to prevent.
• If the actions, or lack thereof, of a CEO harm an
  employee, the CEO is liable for damages.

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Sarbanes-Oxley Act of 2002

• Civil, criminal, and accounting reform that
  expanded CEOs accountability
• CEO must certify that reports submitted to SEC
• CEO must reimburse company for bonuses or other
  incentives if financial reporting is misleading
  (even if the misconduct was not attributable to
  CEO)

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Sources

• The Wall Street Journal
• Forbes
• Simon, David. External Pressures on the CEO
  Worse Than an Excedrin Headache.
• U.S Department of Labor Bureau of Labor
  Statistics.
• Barnes, A. James. Law for Business, 9th ed.
• Wikipedia.com
• MSNBC.com
• News.com