by Johnny Bravo

Created on: October 10, 2008

The issue of paying top executives a fixed salary or rather laying out a ceiling for their salaries is very much a controversial topic. On one hand, you would imagine that a maximum salary would probably ensure that the executives make decisions more wisely. On the other hand, wouldn't the contrary be the incentive for executives to continue to make the same decisions if not more wisely than otherwise. However, I am totally opposed to the maximum limit that businesses suggest that should be paid yo the CEO and following are my reasons concerning just that.

Firstly, monetary benefit to any person on this planet is probably the most important incentive to do any work. Once a limit or a ceiling is placed on that, executives who have reached that state will probably slack as there is no further incentive or challenge to keep them performing harder as they know that however extra wisdom is used in making decisions or however much they work hard by putting in extra hours for the job they do, they know for certain that nothing more stands to be gained from it.

Secondly, looking at the issue from the personal standpoint, I too want to be an business executive one day and I personally wouldn't want anyone to tell me that this is the maximum amount of money that i can take home from now on. I am sure everyone in the world no matter whatever position they are in right now will share my same sentiment.

Thirdly, these executives who become CEO of companies have spent several years working really very hard in universities and colleges to attain the several degrees that they boast of combined with the several years of work experience that make them worthy to occupy such a high post as that of a CEO of a company. If suddenly, one fine day, someone tells them that they can earn no more than they currently earn, all thee hard work they put in in those earlier years would probably seem fruitless to them. It would amount to nothing short of injustice to them.

Finally, CEOs are people who define the way forward for business to remain profitable. For businesses to sustain and continue to do well, setting a ceiling on pay would not be the right way going forward especially in the current state of the economy. A certain price will always have to be paid for the overall well being of the economy and salary I believe will be one of that which should never be fixed.

In summary, the above few reasons would amply justify why a maximum limit cannot be set that businesses can pay their CEO for it would lead to total injustice.

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