The Occupy Movement no longer occupies the Aotea concourse by the Town Hall but last Monday's headlines in the Herald remind us why the movement came into being. Its seed was the inordinate greed evident in the Wall Streets of this world, greed that has clearly not left New Zealand unscathed.
Pause to consider the headline: "Combined pay tops $5.5m for bosses of four energy firms". Four people each earning over a million dollars a year. Each person we were told received a rise of over 11% whereas the average wage increase in NZ in 2010 was 1.7%.
This one headline was symptomatic of a number of others in the Herald during the last twelve months. Here are some examples: April 30, 2011 "More $5 million men as earnings climb" (there were four, the CEO's of Westpac, Nuplex Industries, Telecom and Fonterra, each with a salary of over $5m per annum); October 26 2011 "SkyCity presses on with fee raise vote" (this took the directors' fee pool from $1m to $1.5m); February 27, 2012 "NZ tax on rich among the lowest in the world" (shows the other side of the equation, in the UK high earners face a 50% tax rate on their income).
All of which in New Zealand is not simply scandalous it points to a systemic evil.
Why? The reality is, that when we look at a company, be it an energy company, a bank, a telco, or whatever, we discover that there is in fact only so much money to go around. The earning power of a company however efficient it might be is circumscribed by its customer base.
It is that base that provides the cake and it is the cake that is sliced up in order to pay all who work for the company from chief executive to the lowliest staff member, not forgetting the shareholders.
So the outcomes are clear. When the chief executive receives a huge salary and bonuses then others in the company's workforce pay the price and receive correspondingly less.
More often than not the "less" falls most heavily on those in company positions that are perceived to be at the bottom of the heap, but others pay the price as well.
I am not arguing against those who have put in years at university, or those who have greater skills, or who are capable of taking on greater responsibilities, being paid more. I agree with that. But the truth is that what has happened in our society is far from being just that, it is completely over the top.
A guideline for me would be this. No one occupies a more responsible position in this country than the Prime Minister, a person whose salary is less than $400,000 a year, and who has to live under media scrutiny virtually every day. Consequently the Prime Minister has a greater accountability to the population at large than any other CEO in the country.
Furthermore the main bonus that he or she may receive by virtue of good leadership is to be elected for a further term. While the PM's salary is well above the average wage (approximately $54,000), it is a mere pittance when compared with what some CEO's in this country receive. This, in my view, demonstrates the grossly excessive nature of the annual payments to many CEO's.
But who is at fault here? Principally I believe it is the Boards of Directors and the share holders that support them. Boards of Directors who advocate such excessive salaries need to be called to account by shareholders for it seems that far too many have been seduced by oft quoted slogans such as "if you pay peanuts you get monkeys".
I believe that is nonsense. I believe that there are people in our society who aspire to challenges, who rise to responsibilities, and who get far more satisfaction in delivering excellence, than they do in the extensive nature of any pay packet offered or received.
I believe that there are many people who have a respect for their fellows, a commitment to ethical living, and who are not driven to obtain the highest possible financial packet for themselves at the expense of others. Let the Directors seek them out and if they don't let shareholders call the Directors to account.
As this is the season that Christians call Lent, a time for cutting back on excesses, let me end with ten "commandments" which if taken seriously could make an impact and call us back to some kind of sanity:
1. Let there be no executive pay rises that are above the rate of inflation.
