Corporate America’s big mistake — runaway CEO pay

A new study shows that CEO compensation at top companies in America is soaring — a stark contrast with the stagnant salaries of many rank and file employees across the country.PAULSON+MONEY.jpg

And very interesting in light of the huge profits that Big Business raked in last year.

The median salary for the top executives at the companies surveyed rose 12 percent in 2010 to $9.6 million, according to the study commissioned by the New York Times.

At the top of the food chain is Philippe Dauman, CEO of Viacom Inc. who brought in $84.5 million.

Others with big paydays include, Lawrence Ellison of Oracle Corp., $70.1 million; John Lundgren of Stanley Black & Decker, $32.6 million; and Robert Iger of Walt Disney Co., $28 million.

CEOs should draw a company’s largest salary. They are, after all, at the top of the food chain and have the ultimate responsibility for the company’s success or failure. But in an era of widespread wage freezes, pay cuts and layoffs, there is an important distinction between a big salary and one that’s too big.

Under the new financial regulations, shareholders are supposed to have a say on executive compensation. Instead of rewarding CEOs with excessive salaries, shareholders should demand that companies invest in job creation, new equipment and anything else that will add long-term value to the company.

Unfortunately, the new financial regs do not require companies to accept shareholder recommendations.

Here’s the NYT report: The Drought Is Over (at Least for C.E.O.’s)