There is always a risk that the share price will fail to reflect changes to the underlying health of the business during a director’s tenure, which may not become apparent for decades to come. Alfred P. Sloan created some of the attitudes, assumptions, and structures which eventually failed GM. What about Jack Welch? Is the flat share price since he left GE not connected with his tenure? Either he groomed incompetent successors who are responsible for the recent poor performance, and his pay should have been docked for that failure, or his successors are competent, and it is unfair on them that he received all the credit (and bonuses) for the overall growth in GE’s share price over the last thirty years, when it was simply luck that he left before the market corrected itself.

It would be better for society, and for the future of capitalism, if no executive earned more than say fifty times the average salary. CEOs do not take the same downside risks as entrepreneurs so they do not deserve the same upside rewards. And, also for the sake of the economy, anyone who has entrepreneurial skills worth more than fifty times the average salary should create their own company.

Companies from countries with relatively modest CEO pay often do better than rivals from the UK and the US. For that matter, American companies did as well if not better than the do now when CEO pay in the U.S. was relatively modest.

Barclays share price has halved over the past couple of years.
Reckitt’s has risen.

The issue is that pay should be linked to performance.
Diamond’s pay is evidently not. (Of course he can produce an argument as to how he contributed).
But the overall return does not lie.
They are not held accountable.

And yes it does make a difference that Becht has given the money to charity.
Why would that not make a difference?

There are two issues:
(a) the absolute level of rewards.
(b) reward while leading the ship into an iceberg.

The first is the point about managers being seen as aliens.
The second is far more egregious and also dangerous to the system itself.

Diamond is far worse than Becht.