Executive pay, it's just outrageous

Golden handcuffs, golden parachutes and share options - the language of high flying executives. I am a capitalist, I believe in free market economics and a lassiz faire approach to markets.

I believe it is business owners and entrepreneurs who generate wealth and jobs, they are the ones who shoulder the extreme personal financial risk and should be adequately rewarded.

The CEO, commissioned by the board implements the vision and strategy to achieve strategic outcomes. But what is a fair reward for a CEO who has no financial risk in the organisation?

Sol Trujillo, the American businessman brought in to lead Telstra is a case in point as his tenure at the former national communications company was a dismal failure. His $11 million annual salary was an affront to ordinary working Australians and mum and dad investors with Telstra capitalisation declining $25 billion in value during his tenure.

The share price under performed by 25% and complaints rose 300% during that period. Taking his golden parachute, his parting gift to Telstra shareholders and all Australians was to describe Australia as "racist, backward and like stepping back in time."

Paul Simon, the former Woolworths CEO ensured Woolworths executives were limited to 30 times the lowest paid worker at the company. So, a worker earning $50,000 per annum would result in $1.5 million for the highest paid employee - note the term employee.

In the United States, top CEOs, who in the late 1970s made 30 times more than the average worker, today make close to 300 times more than the average worker. This worldwide trend needs to be reversed, Paul Simon had the right idea.