Case Study $1.$ CEO Pandemic Pay...Taking One for the Team or Window Dressing? During the $20202021$ global COVID$-19$ pandemic, many executives$$ pay was stifled, reduced, or even withheld. In an effort to build unity and keep people in jobs, some executives decided to make personal sacrifices. For example, Ronald Rittenmeyer, CEO of Tenet Healthcare Corporation, gave up three months$$ pay$$roughly $$390,000$to a fund that was set up to help struggling employees. While this may seem quite generous, even after the pay cut Rittenmeyer$$s salary, including bonuses, was close to $$2$ million. This amount does not include his stock awards, which were worth more than $$11$ million. Little wonder, then, that one of the largest U$.$S$.$ unions said Rittenmeyer$$s donation amounted to little more than $$a gesture.$$ A study examining companies during the COVID$-19$ pandemic found that $762$ companies issued some type of action to reduce executive compensation during the crisis. However, as the study points out, $$The average amount of base salary reduction for the CEOs only makes up about $7\mathrm{.}8\%$ of their total granted compensation.$$ This may not be much of a sacrifice when you consider that the typical pay package for CEOs at the largest U$.$S$.$ companies tops $$12$ million per year. To put this number in perspective, companies in the S&P $500$ stock index pay executives, on average, $264$ times as much as median employees. Is it too much? That depends on who you ask. To most people, it seems unreasonable that a boss would make $264$ times the pay of the average worker. However, if you ask workers who have seen their CEOs steer their companies back from the edge of bankruptcy and weather the storm of a pandemic, they might not complain too much. Questions $1.$ Are CEOs and key corporate executives worth the large pay packages they receive? Explain. $2.$ Do you agree with Peter Drucker that corporate executives should receive compensation packages no larger than a certain percentage of the pay of hourly workers? Explain. $3.$ Has the Dodd$-$Frank Wall Street Reform and Consumer Protection Act giving shareholders the right to vote oCase Study $1.$ CEO Pandemic Pay...Taking One for the Team or Window Dressing? During the $20202021$ global COVID$-19$ pandemic, many executives$$ pay was stifled, reduced, or even withheld. In an effort to build unity and keep people in jobs, some executives decided to make personal sacrifices. For example, Ronald Rittenmeyer, CEO of Tenet Healthcare Corporation, gave up three months$$ pay$$roughly $$390,000$to a fund that was set up to help struggling employees. While this may seem quite generous, even after the pay cut Rittenmeyer$$s salary, including bonuses, was close to $$2$ million. This amount does not include his stock awards, which were worth more than $$11$ million. Little wonder, then, that one of the largest U$.$S$.$ unions said Rittenmeyer$$s donation amounted to little more than $$a gesture.$$ A study examining companies during the COVID$-19$ pandemic found that $762$ companies issued some type of action to reduce executive compensation during the crisis. However, as the study points out, $$The average amount of base salary reduction for the CEOs only makes up about $7\mathrm{.}8\%$ of their total granted compensation.$$ This may not be much of a sacrifice when you consider that the typical pay package for CEOs at the largest U$.$S$.$ companies tops $$12$ million per year. To put this number in perspective, companies in the S&P $500$ stock index pay executives, on average, $264$ times as much as median employees. Is it too much? That depends on who you ask. To most people, it seems unreasonable that a boss would make $264$ times the pay of the average worker. However, if you ask workers who have seen their CEOs steer their companies back from the edge of bankruptcy and weather the storm of a pandemic, they might not complain too much. Questions $1.$ Are CEOs and key corporate executives worth the large pay packages they receive? Explain. $2.$ Do you agree with Peter Drucker that corporate executives should receive compensation packages no larger than a certain percentage of the pay of hourly workers? Explain. $3.$ Has the Dodd$-$Frank Wall Street Reform and Consumer Protection Act giving shareholders the right to vote on executive pay influenced the size of these packages? Explain.n executive pay influenced the size of these packages? Explain.