Lenovo CEO Shares $3 Million Bonus With Workers 169
hackingbear writes "Yang Yuanqing, founder and CEO of Chinese PC maker Lenovo, will share $3.25 million from his bonus with some 10,000 staff in China and 19 other countries. 'Most are hourly manufacturing workers,' Lenovo spokeswoman Angela Lee said. 'As you can imagine, an extra $300 in a manufacturing environment in China does make an impact, especially to employees supporting families.' In its annual review last year, Lenovo raised Yang's base pay to $1.2 million and awarded him a $4.2 million discretionary bonus and a $8.9 million long-term incentive award. Yang owns 7.12% of Lenovo's shares, equivalent to about $720 million in stock."
Let't reward this! (Score:5, Interesting)
Thanks for the info. I will make it a point to buy / recommend Leveno products. I want to reward this behavior.
Psychology (Score:3, Interesting)
This guy is the CEO. He could just as well have Lenovo give this bonus directly to its employees, which it will probably (have to) do anyway. Instead he's trying to make himself look good. Might be worth the trouble; the (apparently) kinder the CEO, the more loyal the employees. But this is not an act of charity; it's just a normal bonus with a well thought-out psychological plan behind it.
Re:return what you don't deserve... (Score:5, Interesting)
I'm a Libertarian who thinks corporations should be outlawed in current societies and denied any form of special privileges like limited liability or any form of personhood in a utopian free society. What were you saying again about grossly overpaid CEOs? I agree that they are grossly overpaid. I suspect that most of them could be replaced with someone who makes less than 100k per year no problem.
Even if the company made a little bit less money it would be good for the morale of everyone else if one person were not so ridiculously overpaid.
I think you have to be blind to not see that a corporation represents an unhealthy concentration of power in the hands of a few. Power corrupts. Also the behavior of a corporation is indistinguishable from that of an individual sociopath. The last thing we need is more sociopaths in our or any society. We certainly should not be encouraging them as we do now.
Companies, as in groups of individuals working toward a common goal, which should not be to make a pile of money in any way they can, but to produce a product or service they can be proud of, while hopefully at the same time earning enough to live comfortably, are themselves necessary evils because when they grow large they grow powerful even without limited liability or legal personhood, but there is simply no alternative that actually works. Human beings have to work together in groups to produce useful things. Government owned corporations are no better than privately owned ones. In fact they are usually worse.
You know what else is a necessary evil? Governments. That's why we Libertarians like to keep them as small as possible. In general I'd also like to keep companies as small as possible, but large companies also have advantages in terms of more affordable goods and services for poor people. Human beings simply don't behave as well in groups, especially in large groups, but I don't think artificially limiting their size makes sense in the way it does for governments. The economic advantages for the poorest members of society are simply too great. Nevertheless I think it would have great non-monetary benefits on society as a whole if all companies or organized groups of any kind were limited to no more than 100 people.
Are you sure you weren't thinking of a Republican. Some of you pro-government types get us confused so easily but we actually have very little in common. Some very minor common ground in economic theory with a small minority of them, probably the ones who call themselves tea partiers, and that's all.
Re:Please notice the per employee amount. (Score:4, Interesting)
But if you read the fine print, you see that it only looked at the top 350 companies. If we were to cut these CEOs down to size and confiscated all the money they made last year and redistributed it to the 145 million workers in the U.S., each worker would end up getting ($14.1 million)*(350 CEOs)/(145 million workers) = $34 each. If you divide it by the number of workers in the Fortune 500 (24 million), it's $205 each.
The authors of the paper came up with the methodology for tracking trends in CEO pay over the years. Unfortunately it's been hijacked and misreported to fit the narrative that CEOs in general are siphoning off substantial amounts of money our economy is generating, and if it were fixed everything would be much better. That simply isn't the case. While the top CEOs may make enough money to afford themselves a lavish lifestyle, in terms of the overall economic output of their companies it's peanuts.
If you want a better, broader measure of income inequality, you should be looking at things like Gini coefficient [wikipedia.org]. But "Income inequality 50% worse in U.S. than other Western countries" isn't as great a headline as "CEOs make 273x more than their workers."
Re:Please notice the per employee amount. (Score:3, Interesting)
As someone that often comments on overpaid CEOs, I feel like I need to reply to this. There are many aspect to it and many different cases.
First of all, his salary (what ever you call it it is a salary) is not $3 million. It is $1.2M+$4.2M+$8.2M. That's actually more than 13 million dollar a year. I won't even talk about stock, because arguably it is not salary. (But let's be honnest, at these positions abusing stock options is not really difficult. Also you have a pretty good picture of where to invest.) He shared 20% of his salary. He could share twice that and still not really see a difference.
Now, putting it in context. The GDP per capita in China is $6,000 a year. So when he gave them $300 which is claimed to be nothing by GP but he actually increased their salary by 5%. If I received 5% more salary, I'd be quite happy. (Remember he could share twice that.)
Now, the CEO is paid that. But he is likley not the only executive paid a ridiculous amount each year. (Because the guy lives 50% of its time in China, see what you do for a million dollars a year in china?) There are other executives which could lose 20% of their salary without wondering how to heal their son's broken arm at the end of the month. It is difficult to know how many there are, but you probably can scrap another $3 million.
Then there is the fact that when the guy leave or get fired or whatever, he will get a leaving bonus of again millions of dollars. Often it is a bonus for the guy that screws up. So even if the guy does crap and screw up and get fired after a single year, he will still get more money than you and me in 10 years. And more money than 10 of these chinese worker in a lifetime.
Then I am not convinced that whatever the CEO does (I don't know this one in particular) is actually worth the salary they are paid. I understand you need a guy with the ultimate decision on everything. But that's pretty much the only thing he does. Because all the strategic informations and negotiation of contract is not done by him alone, but by an army of analyst, lawyers and tacticians. On top of that, he is pretty much liable for nothing.
He can get the money, I understand he takes it. But don't tell me you feel like it is fair.