Wednesday, June 17, 2009

AIG vs ex CEO

This topic is something I talk about a lot when it comes to business. It doesn’t make sense to me that companies give top executives share options in the companies they are in charge of. Why would you hire someone to run your company with the interest of the customers and shareholders, after you give them thousands of shares in the company they are ultimately responsible for? Don’t you think their decision-making just turned bias? If your decisions affect your own pocket by millions ether way, don’t you think that persons’ gain might persuade their decision making over what’s good for the business? I feel that if the government should get involved in the amount the top executives make then put a limit on shares also not just on the dollar amount. CEOs could temporarily increase stock shares long enough to cash out when they retire making the millions of dollars. It’s not always illegal ether, you can buy back stocks for the company causing less shares in the market which drives up the stock value, you can split shares causing twice as many shares to flood the market which lowers the price of the stock causing more people to by stock splits. Companies can even issue new stock which cause the increase in price plus brings in more revenue into the company. Announcing new ideas or possibilities could drive up the share value as well. All of these examples are not illegal or unethical, but they will add millions to executives with a lot of shares. Why not prohibit companies from issuing their own stocks in bonus packages for top executives. If a CEO had thousands of shares from thirty different top corporate companies it would take the personal nature out of their job, it would free up their mind on what decisions would affect their pocket and allow them to due their job to the fullest. I feel it would help the companies run more efficient and have the customers and shareholders in the forefront of decision-making. The idea of CEOs and all top executives counting on each other to run a better business for their shares to increase in price (like the rest of this country) is more sensible for the business sake. I was always taught there are no feelings in business, that it is what it is. Business is just Business and don’t read into it. My question is, why give someone the ability to put feelings in business especially someone with the power to affect everyone else. This is why the financial sector of this country crashed causing the whole country to go into a recession. This is why AIG is in a civil suit trying to retrieve 4 billion dollars. Take greed out of the hands of powerful people, and then we could eventually get back on track as a whole, as a country.

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