There are three problems that seem to dog most of the egregious CEO COmpensation cases: 1) Full Disclosure in advance; 2) Board of Directors with conflicts of interests; 3) Failure to represent the Shareholder’s interests.
As long as the Board does its job, is conflict free, and the pay packages get disclosed in advance, the Shareholders should be protected.
When those elements are missing — when there are conflicts of interest, a failure to disclose, and/or a Board not protecting S/Hs — that’s you get the more abusive situations we have witnessed . . .