Question

In: Operations Management

Should a CEO have Guaranteed Pension provided.

Should a CEO have Guaranteed Pension provided.

Solutions

Expert Solution

CEOs are the top executives who receive huge compensation and salary in comparison to the normal employee in the organization in some organization, this difference can be even as high as 1000 times. Along with that, there is also a provision of unlimited tax-deferred compensation for CEOs and it amounts to be $3 million. The concept of a pension plan is to facilitate the monetary safety after retirement to those individuals who have moderate to normal salary during their working life so that they can lead a normal life even after the retirement Even at present more than 40% of Americans do not have any type of retirement plan and they are also not having enough savings to sustain their life after retirements.

On the other hand, if we look at the CEOs who have lavish lifestyles, a huge salary and other benefits do not have any such financial liabilities or insecurities. If the pension is offered to those individuals then somehow it will deprive the ones who really need it. Therefore I would suggest that looking at the financial difference between the normal employee of the organization and the CEO, there should not be the provision of pension for the CEOs


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