A bouquet, not a brickbat, for Toronto Star Business Columnist David Olive, who has had a mighty busy New Year by the looks of things. Not only does he have four columns in today’s Sunday Star – two on the hanging of Saddam Hussein, one on the $210 million parachute for Robert Nardell on resigning from Home Depot, Inc, and one
response to letters on an earlier column, but he also has a long piece in This Magazine on Red Toryism.
I’ve enjoyed David Olive’s writing for a long time. He’s not particularly left-wing, but he does have a strong sense of social justice, and — unusually for a business columnist — it comes through in his business writings. He’s done sterling work over the years reporting on CEO salaries, for example. He’s careful with his facts, writes clearly, and makes strong points in a thoughtful manner. We could do with more journalists like him.
A small side note… I don’t see CEO overpayment as a social justice issue. It’s a corporate fraud issue. If it were treated more in that way, we might get some headway on finding a way to stop it.
For example, say you wrote a book and got a royalty of $2 per book, and the book sold 105 million copies. I don’t think anyone would object to your income (which is the same as this Home Depot CEO’s severance). The tax rate you pay is a social justice issue, but the income isn’t.
CEO/corporate board member overpayment is shareholder fraud. Shareholders need to stop putting up with it, and we need laws to regulate it. The practice should be seen as something that could undermine confidence in the market, like insider trading.
I disagree. I mean, I agree that there is a corporate fraud issue in CEO overpayment – in stock option backdating and so on – but I don’t think that’s all there is to it.
CEO pay compared to average pay varies greatly from country to country and from time to time. The differences are important, and are not just a matter of fraud.