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Should Hostess execs get bonuses?
By Lauren | December 6, 2012
Newsfixnow.com reports that a federal bankruptcy judge has approved the payout of $1.75 million in bonuses to nineteen corporate officers and senior managers of the defunct Hostess baked goods company. That’s an average of over $92,000 apiece, approximately twice what the average American family earns in a year. Not too shabby for an executive team who tanked the business and put over 18,000 people out of work right before the holidays.
The bonus admittedly comes with strings attached. The would-be recipients have to stick around through Hostess’ liquidation to get their payments, and presumably they’ll have to do at least some work to wind up the company. Still, it makes no sense to me to reward executives who failed to keep the company afloat while rank-and-file workers suffer for their ineptitude. You can bet that none of Hostess’ bakers and factory workers are getting hefty holiday bonuses this year.
The bankruptcy judge’s decision reflects a popular philosophy that’s both disturbing and entirely too pervasive. Somehow, we seem to have decided as a nation that executives are inherently more deserving than the people who work for them, entitled to be rewarded for even the poorest of performances while their workers struggle to survive on ever-shrinking crumbs from the corporate table. It’s become commonplace for highly-paid CEOs to receive handsome exit bonuses even after they’ve reduced their companies to smoldering wreckage, and that’s just plain wrong. Failed executives shouldn’t benefit from their incompetence. Instead of approving bonus payments to the authors of Hostess’ demise, the judge should have divided that money among the workers who lost their jobs when the company failed, even if the individual payments wouldn’t cover the cost of a Twinkie.
Topics: Business Ethics, corporate responsibility, ethics, Social Ethics | 2 Comments »
December 11th, 2012 at 7:24 pm
Here! Here! I couldn’t agree more! Isn’t this value system the one that got us into years of recession in the first place? When do executives get their toes held to the fire on the consequences of unethical behavior? And who will step up to the table to do it? I have no problem with people working hard and investing well and receiving deserved rewards. However, the dramatic income differences in corporations are shocking. And, while it is certainly true that income does not always follow top quality performance, if it is not linked in some way to performance, and if there is not some equity in the performance-reward link, then people come to believe that “anything goes,” “whatever you can get away with,” “everyone does it.” When do we say, “Enough already! this mentality has caused enough damage to individuals, companies, and our country. We can do better! We are better! We need to come clean, stand for something, and contribute positively to our communities and nation.” And outrageous salaries and bonuses paired with failures only gives those “without” power and money a sense of powerlessness to make a difference. Those with power need to stand up, stand for something positive, and stand against unfairness and illegality, and bring our country back to the values that we stood for in the beginning, and which some people still advocate for: Responsibility, fairness, trustworthiness, caring, respect, citizenship. One doesn’t have to be a religious fundamentalist/fanatic to know that without these values, the core of our communities and our nations crumbles.
December 12th, 2012 at 10:43 pm
Hi Karen,
Hear, hear to you, too! You’re right on, and thanks for the comment.