The search for a new CEO to replace ousted General Motors Chief Executive Fritz Henderson could be seriously complicated by the federal pay cap on companies that have received a government bailout.
As things stand, a new CEO would be limited to less than $1 million in hard cash. While that might be a big lure to the average American, it’s a pittance in the corporate world, especially among Fortune 500 companies, industry analysts warn. But there seems little likelihood that the cap would be lifted, contends influential Democratic lawmaker Sander Levin.
“I doubt if there would be a change to the pay cap,” the Michigan congressman tells TheDetroitBureau.com, even though critics point to the millions of dollars Ford Motor Co. shelled out to attract former Boeing executive Alan Mulally, to sign on as its CEO.
Cong. Levin says he believes that, “There are other ways to compensate executives, including stock. More and more, we want people compensated for performance. GM should be able to attract someone within the pay cap and if they succeed, they will be compensated adequately. If they fail, they won’t.”