2015-05-03 – There’s an ecard floating around the Internet that goes like this:
Think about this for a minute. Do you agree?
My first reaction to this was: “The world we live in is run by adults who WERE spanked. Are you telling me that they are doing a good job?”
My second reaction to this was that I don’t remember participation trophies being handed out after my kids were, maybe, eight years old. They’re fine for the little ones, and we don’t much do it for the older ones.
But then I got to thinking. We most certainly do hand out trophies for just participating. It’s called executive compensation.
Before you start booing, hear me out (and don’t even get me started on corporate dividends).
Last Wednesday, the Securities and Exchange Commission proposed a rule to require companies to disclose the relationship between executive compensation and the financial performance of a company. This rule is being proposed to implement one of the requirements of the Dodd–Frank Wall Street Reform and Consumer Protection Act, that was signed into law by President Obama in 2010. It’s taken the SEC almost five years to come up with a rule. And it’s only a proposed rule.
Guess who is opposed to it?
Corporate executives. They kinda like getting trophies just for participating.
They like telling us that they get the big pay for taking lots of risks. What they usually mean by taking lots of risk is that they like getting paid millions for risking someone else’s money and someone else’s job. When the SEC comes around and says that they want companies to disclose executive performance, they send out their minions (like the U.S. Chamber of Commerce) to oppose disclosing the truth:
That they’re getting trophies for just participating.
Not for winning. Not for having a better than average run. Not for avoiding losses. Not for avoiding bankruptcy. Not for keeping their hands out of the cookie jar. Just for participating. That’s why they are upset at the prospect of disclosing their own financial results, short-term numbers that they control. They don’t want you to find out that they are giving themselves trophies just for participating.
I thought that practice was supposed to end when you turn nine years old. If you are a corporate executive, participation trophies just keep on coming. And it doesn’t matter, even, if you are inept and hurt the team. You still get your trophy. And if you do something outright bad, you never get spanked.
(No eight-year-olds have lobbyists to protect them from the withdrawal of participation trophies.)