Executive Compensation Essay Example | Topics and Well Written Essays - 1750 words

Executive Compensation - Essay Example in that respect is an ongoing public indignation over the idea that there are executives who are rewarded handsomely in firms that are experiencing financial losses, facilities closure and employee dislocations in the form of cuts in pay and benefits and forced terminations.At a time when the public is looking for someone or something to blame, is it correct to cap the current executive pay in the US? This paper will explore this possibility and its impact on American capitalism, whether such(prenominal) a move would be beneficial or harmful to the economy.In the United States, the capitalistic trunk rewards high risks with high rewards and that executives are paid astronomical amounts for their skills and capabilities. The executive compensation in the US incorporate the total rewards received by the top-level executives of a corporation. These high-ranking officers include the mind executive officer (chief operating officer), the chief ope rations officer (COO), the chief financial officer (CFO), as well as the other executives who accord the highest level of management in a firm. The total rewards, meanwhile, is generally consisted of salaries, bonuses, incentive payments, deferred compensation plans, stock options, and the carry on provision of goods and services. The stock option for executives could surpass the worth the direct cash payments such as salaries and bonuses. surplus perks may include packages that consist housing, personal staff, transportation and other personal expenses of the top executives, which are ordinarily shouldered by employees. According to Alan Greenspan (2007), the former chairman of the US Federal reserveA US chief executive officers compensation has, on average, been tied closely to the market value of his or her firm CEO compensation at such large US corporations reportedly rose by 10 part annually between 1993 and 2006, triple the 3.1 percent annual increase of earnings of priv ate-company production or nonsupervisory workers. (p.