Corporate America is fighting a proposed SEC rule requiring companies to calculate the ratio of their CEO's pay to the median pay of all their employees. Nothing seems to get U.S. corporations' dander up like a threat to the pay and perks of their chief executives.
• In the 1970s, he observes, American companies devoted 15 times as much capital to investments as they disbursed to shareholders. Today the ratio is less than 2 to 1.
• (...) outsized CEO compensation depresses employee morale (...)
• The great management guru Peter Drucker advised companies to stick to a ratio of about 20 to 1 between the pay of the CEO and that of the average worker. That's "the limit beyond which they cannot go if they don't want resentment and falling morale to hit their companies"
• Drucker's standard was in line with the ratios of the 1970s and early '80s, when he wrote those words. Today they seem positively quaint. The average CEO-to-worker pay ratio in 2012 was about 350 to 1.
• The CEO-to-average-worker pay ratio of the 250 largest companies in the Standard & Poor's 500 index ranges from 1,795 to 1.