The 2009 National Business Ethics Survey - Ethics Resource Center

Executive CompensationAs some of the recession’s spectacular business failures illustrated, executivecompensation and bonuses can motivate senior executives to seek short-termgains and take excessive risks while ignoring or downplaying the long-termviability of the company.Yet employees are upbeat about the compensation received by their CEOs.Sixty-two percent of employees say that the compensation of their CEO is appropriate.Beyond the “appropriateness” of the boss’s pay package, NBES inquiredabout employee perceptions of this short-term, high-risk issue.Asked whether the top executive’s compensation package encourageslong-term or short-term success for the company, about62 percent said “both equally.” About 25 percent answered longtermand 13 percent said short-term.Does the chief executive’s compensation reward future-growthstrategies, past performance, or both equally? Seventy-three percentanswered “both equally,” 12 percent said past performanceand 15 percent replied future growth.On the question of whether the pay package encourages riskier,high-return strategies, 47 percent disagreed and 27 percentagreed. Twenty-six percent neither agreed nor disagreed.26©2009 Ethics Resource Center