According to a study conducted by the Corporate Library and the American Federation of State, County and Municipal Employees (AFSCME), big U.S. mutual-fund companies are prime enablers of extravagant salaries for corporate CEOs. Among them, Morgan Stanley has been the worst offender, supporting management-compensation proposals 94.7% of the time.
And how did this happen?
“One of the best examples of excessive undeserved CEO pay was the pay package that [former Morgan Stanley CEO] Phil Purcell walked away with,” said Richard Ferlauto, director of investment and benefit policy at AFSCME.
Ferlauto added that excessive pay is often in evidence at big financial institutions. “They may be embarrassed to vote against pay packages that would make their CEO pay packages look even that much more excessive.”
No wonder Jamie Dimon, the new CEO of J.P. Morgan Chase, claimed in an interview in FORTUNE magazine that: “I’d tell people they were overpaid, and guess what? They already knew it.”
Before you applaud Dimon (or Demon, if you read the interview) for his straight talking, here’s a lightweight but interesting piece on Jamie Dimon and the Art of Bullshit.