“Charlie and I try to interact with our managers in a manner consistent with what we would wish for, if the positions were reversed.” – Warren Buffet, 50th Shareholder Letter
“I will only hire someone to work directly for me if I would work for that person,” – Mark Zuckerberg, Mobile World Congress
Here are two people spanning generations who both believe that shared values and a focus on relationships are the key criteria in hiring. These quotes also fit with the general wisdom that people go to work for a company, but leave because of their boss.
If you also would prefer to hire someone you would be willing to work for, start to think about what those qualities are. Contact me if you want me to work with you through some values exercises and career conversations to bring those qualities to life.
Now, let’s go a giant step further and address executive compensation starting with Buffet’s additional quote in the same shareholder letter: “A Berkshire CEO must be ‘all in for the company’ not for himself … At Berkshire, directors walk in your shoes.”
When I went to work for Merrill Lynch in 1975, there was a saying, “Bulls and Bears make money, but hogs get slaughtered!” Don Regan, then-CEO of Merrill Lynch, made a point of telling us that the top five paid people at ”Mother Merrill” that year were salespeople, not executives, because the sales people drove the business creation and value – not the executives.
I wonder: How do these quotes and prevailing wisdom fit with today’s spiraling top executive compensation? How can every top executive be in the top quartile of performance, which is often the stated justification for these increasingly “generous” payments? How can boards of (often interlocking) directors continue justify handing excessive payment “gifts” to fellow CEOs?
Now for the coup de grâce: How many of us want to work for/hire someone whose sense of equity is to stuff their pockets with as much corporate money as possible? In what way do we model great leadership when we provide ourselves with excessive compensation? Finally, what is the effect on organizational integrity when we covet or receive this excess compensation and this compensation is shared only by the few people at the top?
In the next blog, I will offer an explanation of why executive compensation has risen so quickly and dramatically to atmospheric levels in this country. Hint: It has nothing to do with value creation!