The emphasis in my research is put on the problems of excessive chief executive compensation, insufficiently independent corporate board members, lack of transparency in the activities and decisions of boards, and the lack of the laws enforcing regulation of compensation levels.

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The first part of the research is following the evolution of the executive compensation from its early foundation in General Motors Company. After the World War II annual incentive plans were being installed in businesses across the United States. Long-term performance plans finally emerged in the form of long-term cash payments disguised as the performance units.

Starting in America in the 1980s, the gap between the average worker salary and their executives began to widen annually before taking off exponentially and peaking around the turn of the millennium. In 1980 CEO pay equaled 42 times the average blue-collar workers’ pay while by 2011 CEO pay had grown to 380 times the workers’ average pay.

The last part of the research points out the problems of familiarity, nonperformance pay and lack of laws and regulations. Offered solutions include the alignment with E.U. laws, full implementation of the Dodd-Frank Act, reduction of familiarity connections, and the elimination of the safety-nets.

You can read my report if you wish to find out more details about this interesting topic.

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