Businessweek informs us that Japan has recently instituted new rules that require companies to disclose executive pay over US$1.1 million. Interestingly, there are only 300 individuals that meet that criteria. This, in one of the largest economies in the world. Businessweek, naturally, frames this as a disadvantage: Japanese companies will have trouble recruiting, etc. Blah, blah, blah…I note though that the Japanese private sector’s ability to successfully navigate in the global economy, while not the big scary threat that mediocre Sean Connery movies are made of, remains, er, solid. Toyota aside, of course.
Apparently it’s not just what the market will bear, it’s also what the culture will accept.
Contrast with the United States. And here’s one of my favourite factoids: the average American executive earned 42 times that of average American worker in 1980. By 2008 this ratio had skyrocketed to 319.
But then, we all know American CEOs have gotten 7.5x better.