If shareholder value is paramount and corporate executives are shareholders, what ensues is an absorbing conflict of interest. The greed in C-Suites and Boards gets fed like confinement lot cattle. From the 1980’s onward, reliance on personal credit debt and the pressure to earn and own more grew ravenously in America. With the added fuel of increasing personal debt, the dharma of upholding core civil values competed with the intrigue of personal wealth building, and the gap grew ever wider.One cited study compares average income for hourly workers and CEOs. The trend is remarkable. “In 1970, the average CEO compensation was 11 times the average hourly worker wages. In 1980 the gap was 42 times, and in 1990 CEO compensation was 85 times greater than average hourly wages. CEO compensation in 2000 demonstrates a pay gap of over 531 times the average hourly worker wage.” Since then, the disproportional pay gap has widened.
The process of socialization implied by these statistics has worked to justify greed, fear, and mediocrity in organizations. This is widely known, but it has not appeared to inspire an effective reaction internally from the organizational effectiveness field (organizational development and leadership development practitioners), or externally from C-Suite associations like The Conference Board (“Trusted Insights for Business Worldwide”) or Business Roundtable (“More Than Leaders. Leadership.”) or The Chief Executive Officers’ Clubs (“CEOs Making Money And Having Fun While Learning”).
Are you stuck in bottom-up versus top-down arguments for organizational change? How do you think core civil values will regain prominence without truly effective leadership at all levels?