On Tue, 01 Feb 2005 22:11, Nick Rout wrote: > On Tue, 2005-02-01 at 21:49 +1300, Christopher Sawtell wrote: > > Remember that in the US company directors are legally liable if they > > fail to > > produce the maximum return possible on shareholder funds. > > thats commerce for you. the leading cases in this area centre around > whether said directors are allowed to benefit at the expense of the > company (ie in this case the shareholders). If such rules did not exist > comanies could and would be run for the directors.
One could argue that _this_ is the case now. I read (i think in the press or a mag) about how uni students in the UK had done a study on CEO etc wages / salaries verse company share price (or some such). result was that the money a CEO got did not (in most cases) justify their huge wages / salaries because the profitability / share price didn�t move all that much over the year(s) and in some cases fell. the students I think in the short piece that i read proved the point that a CEO should be paid X amount of dollars and then if the share price went up (and presume that they stayed up for 6 - 9 months) then they get a bonus of y and if the profitability of the company stayed high then they were given a further bonus now if this _was_ the case how much do you really think these people would be on ??? and just think about how much more money would be paid out to shareholders (and of course the dividend to share ratio would increase meaning the share price would increase basically snow balling). And if the CEO was always on top of the game then they might come out with more being paid to them. but then who would do this in real life no one. my 23 cents worths. -- Dave Lilley
