Quote:
Originally Posted by NorvTurnerOverdrive
i don't understand how corps which are in a constant state of refinement, streamlining costs at every turn, can turn around and pay someone exorbitantly. regardless of what they do.
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Contra SportsDino, shareholders aren't idiots, they just have no control. Corporate law has long been aware of the collective action and principal-agent problems corporations pose. Directors, often executives themselves, have a stake in keeping CEO salaries inflated. No one has any incentive to run real proxy fights--you foot the entire bill, but receive only part of the benefit if you succeed. It's easier to just sell your stock if you're fed up with management.