High CEO salaries are an easy target

CEOs are currently an easy target for everyone's anger. Overpaying of CEOs, for less-than-stellar results is a problem. The CEO's compensation plan is negotiated between the prospective CEO and the board of directors. This may be where the problem has been in the past.

Now there is a law to stop the Enrons and the Tycos. It is called the Sarbanes Oxley act of 2002. It can hold the CEO, the CFO, the board of directors, and the outside accounting firm criminally liable for overpaying a CEO, or underreporting losses or accounting problems in the company. This holds all parties accountable for their actions.

We may not like that a CEO makes millions of dollars to underperform, but I view it like baseball. The Cubs for years have paid players much more than they were worth on the field, and some players were paid little by comparison and overachieved.

A top-of-the-line CEO has to be enticed to leave another job, where he is performing, to come to a company that is underperforming. This entails risk. Risk is a cost. No one in their right mind would leave a good safe environment without some level of security.

Furthermore, if the board of directors can't make an offer that is reasonably provocative, they will not draw the talent. Being a great CEO like Iacocca or Eisner is a talent that not many have.

Lastly, this is America we live in, a capitalist society, that gives us all an equal chance to take risk and get rewarded.

Jerry Donlon

Schaumburg