Exposé d'anglais. sujet: top managers pay

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	Exposé d'anglais. SUJET: TOP revenir au plan			docs
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TOP MANAGERS PAY

Top managers deal with major business issues, and their pays are supposed to reflect their effort.
Even if, they are among the highest paid workers in return they have to provide a hard work .
Usually salary levels vary substantially depending upon the level of managerial responsibility, length of service, and type, size, and location of the firm.

But what are at the origin of theirs high pays ? and what are the repercussions to the fact there is a compensation to this high level of pay ?

I)

First of all, in addition to salaries, total remuneration often includes stock options , dividends and other performance bonuses. Theses variables bonuses are the main explanation of top managers’ pays soaring.

Hence, the way they run companies take into account the fact that a big part of their pays depend on the value of the corporate stock prices, and more and more top managers own a bit of huge companies by taking securities.

Moreover, in some companies the use of companies cars, cellular phones, travelling expenses… can be considered as a part of their total remuneration.

TRANSITION :

So as to set management aims more closely with shareholders’ wills, business consultant have recommended companies to index-link top managers’ pays to stock prices.

II)
Companies’ top managers work at the behest of shareholders, who are represented by an elected board of directors and they have the right to vote to have management restructuring.

As a result, top mangers have an uncertain job future since their position depends on their performance.
Sometimes, they take many risks in order to satisfy the financial markets, which put a Sword of Damocles on their head because if they are not efficient enough they may be dismissed. The only way they can make money is if the value of the company’s stock grows through their efforts.

Furthermore, all of this can be to the detriment of employees, as top managers’ main target is a high level of the Ebitda (Earning before interest tax depreciation and amortisation).

III) Example to illustrate the subject:

For example Jean Marie Messier, the chief executive of Vivendi Universal, who’s remuneration in 2002 is established to 1,7 million Euro (fixed salary), plus a variable part indexed to 40 % on Ebitda, 40 % on the free cash-flow and 20 % on the debt clearing of Vivendi Universal.

He took many risks to make his group become a big and successful company, and he has fail in his task. Consequently to his wicked result he has to confront disappointed shareholders at an annual general meeting, and now he see his future quite uncertain after a precipitous two-year slide in Vivendi’s share price.


CCL:

Companies do their best to attract and retain their top managers. Top managers are being rewarded for that increased risk and responsibility.
And they are more privileged than employees, for example Enron top managers took their precautions before the big crash of their company whereas employees were deceived because they were confident.

Merci.

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