Question

Explain in details what executive compensation is and how it's useful in Business Ethics

Answer 1

Executive pay represents how a company chooses to pay its top executives in order to motivate them to perform their best. These benefits come in the form of increased salaries, benefits and compensation packages, stock and call options especially ones linked to the success of the company, in order to also ensure loyalty and drive towards achieving the best possible outlook for them. Now, when we consider the ethical implications of executive benefits, we come to a literal gray area where we can neithe say that it is unethical due to the large pay gap between the executives and the other employees, neither diagree to the fact that the reason the individuals at executive positions are being paid more is because they are the actual driving force behind the company's success and direction towards profitability. It is however fruitful to create the basic understanding that not only does it drive the entire organization towards a better financial path, simply because the executives are more motivated and driven to gudie the organization towards the best possible outlook, but also the fact that this compensation is known throughout the industry, allowing the company to attract the best talent and most hard-working and driven individuals from other companies to become a part, allowing an even more strategic position for us.