YouSaid · the spoken record

Steven Clifford

lines on the record: 104
first: 2017-08-25
most recent: 2017-08-25
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Well, you know, the book what I did was I took the four highest-page CEOs, the people named the highest-paid CEO from 2011 to 2014. I didn't select them because I thought that they were examples of overpaid CEOs. I just took the highest paid. I just took the highest page. So let's say you wanted to look at baseball players and I took the baseball player who had the highest batting average for the last four years. Right.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, this is most of CEO pay turns out to be pay for luck, not pay for performance. All of the studies have shown that CEO compensation and performance, no matter how you define it, is at best weekly, weekly correlated, and at worst negatively correlated, which means The more you pay the CEO, the worse you perform. Makes sense. Marissa Meyer was a... Example of this She was there five years by every measure the performance of the company was poor now Maybe that's all her fault. I don't think it's all her fault because I think that the CEO is not responsible for everything that happens. You know, the CEO has limited abilities to move a big ship. So Marissa didn't do a great job.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Right, right. I mean, you've got every one of these CEOs is ridiculously overpaid and the whole system is causing so much harm to the country that hoping that Say on Pay is going to make any difference is like swatting a few flies.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Boards and directors will not reform this system by themselves. You have this new say on pay, which I don't believe will make much difference. Now, say on pay under Dodd-Frank At least every three years, a corporation must have it offer its shareholders the ability to Have a non-binding vote on whether they approve or disapprove of the pay system. What's happened is that Two or three or four the most egregious pay systems and the most egregiously overpaid CEOs, there's a campaign on say on pay, and often it's effective and it will affect that those three or four CEOs. The problem is they're all egregious.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Stock options by themselves were in unlimited amounts, so anything that related to, well, you can make anything and say it relates to performance. Ironically, this is the thing that truly opened the floodgates to CEO pay going crazy. This was part of the Bill Clinton, the budget reconciliation bill that had the big new taxes coming in in 1992. It passed without a single Republican vote.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, cash stock anything. So he got in office. And then he was lobbied by the business groups that said, well, this is critical for American industry to pay for performance. And so they revised it and said, If it relates to performance, then it's tax deductible.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“80s, right? Yeah, he retired early 80s, and he happened to be a pay consultant. He didn't consider, gee, what if the whole world used these pay consultants? Well, that would mean everybody would get a 20% raise every year”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Milton Rock was the first big pay consultant, and unlike the rest of the pay consultants, who I say are essentially corrupt whores. Not Charlatans, you're going to go right to full on? Absolutely. Milton Rock wasn't that way. I mean, Milton Rock was, I think, very serious. What Milton Rock never considered was how the system would work once everybody used a pay consultant. And so how this spiral would inevitably start once they were all using the same system.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Michael Jensen is a professor of, he was a long time at the Harvard Business School. He was kind of the founder of the founder and evangelist of the theory of shareholder value, that the only thing that matters is the stock price.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Right, right. So you've got to say that it's generally that the stock is terribly undervalued and you can think, well, if I split off this division or split off this, I can get a huge pop on the stock. That's when you go in and try and do a We have been speaking.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Who basically You got to make some changes. What I haven't seen it. I haven't seen compensation be the major issue of activist investors. Because as we say, let's say you're wasting, you know, you paid your CEO $100 million and you should have paid him $10 million. Well, frankly, $90 million is not enough to raise an activist investor campaign. I mean, you've got to move.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Practice. Well, I think Vanguard has always been one of the leading companies and one of the most responsible companies in that field. But you have huge investors, the hedge funds almost always just vote straight management. Big, big investors, TIA, Cref, people like that. They almost always back management. It's very rare for hedge funds or big institutional investors to vote against management. The rule had always been, if you don't like what's going on, sell your stock. Don't try.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Don't really seem to make that much of a difference. You know, if you look at it, you'll find that looking like one is probably more important than competence. That's incredible. It is incredible. But they are taller. They are in average.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Good hair, handshake. All good hair. Handsome. Good voiced, good presence. They're all cast in Hollywood. Right, right out of Central Cast. Exactly. And so.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, actually, you have a Moorish board members than you have a CEO. So if you're looking at Fortune 500, less than 5% of CEOs are women. I think if you're looking”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“That's the status quo, and so you're an independent director. You come on, and this is what you do. This is how pay is handled, and the CEO gets a 15% increase every year. Why would you as an independent director start to make all sorts of ruckus about this? Nobody else is.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, it hasn't worked out because really what has changed? It's not that the people are not independent doesn't mean that the fundamental dynamic of the CEO being your friend, a CEO may have asked you on the board, but you're still independent. The fact that you have Built in pay machine systems that guarantee that the CEO. That's the status quo.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, corporate boards nominate who is going to be on the board. Absent a proxy fight or sometimes some egregious corporate behavior, the nominations go out and nobody opposes them. Nobody says, oh, I'm going to run for that board seat. And so every nominee, I would say the re-election of boards is roughly the same as the re-election of the North Korean Political, if you're nominated, you're going to be put.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“I believe that corporate boards have been incredibly irresponsible when it comes to CEO pay. I tried to be, as I learned something about this, I tried to be more responsible. Some boards didn't like that. A couple of boards I was able to convince to move to a different system of pay. Other boards just ignored it.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“It is a sweet gig. When I was a. Coming close to retirement, I've decided that there was a very good gig and lined up a lot of board spots. And I've enjoyed it. It's been wonderful. I've been well paid.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“I have gotten zero from them because why would they want to make noise about this? They have no effective excuse. So they could just forget what they're doing.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, what they say is, oh, if we don't pay them, they'll go someplace else, which is nonsense. They won't go someplace else. They got no place to go.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“The real problem is what all these other companies are doing. They're paying their CEO so much that we have to follow. We've got no option. We're forced to follow them. It's not our fault.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Very nice side gig. The way you justify it is you say, well, I'm not on the compensation committee, but these are my fellow members and they've studied it and they have the good consultants. And so whatever the compensation committee proposes, Almost gets rubber stamped because you don't want to question your board members. And by the way, if you bring up a lot of questions about CEO pay and what the other board members... You're not going to be asked on too many other boards. And as we've said, they're a nice gig. And then you can justify it by saying, well, look,”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a great gig. Overall, Companies the size of Qualcomm, you'll be getting $300,000 $400,000 a year in stock and cash for attending six meetings. Not a bad site.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Usually, that's enough. Number one, you don't get the consumer spending. Number two, inequality imposes a lot of hidden costs.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Have gone to the one tenth of one percent. Now that's one hundred twenty four thousand households. So the reason the average American hasn't gotten a raise, all the money has gone to a very small percentage of people. They don't spend that. I mean, how many yachts can you buy? You know, after you have your fourth, you're not going to buy your fifth.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Enough to buy my problem. And now the money when the money goes to the one tenth of 1%, as it has, let me stop here and say that they invest that since 1980, 40% of all the gains and growths of the economy”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, to start with 70% of our GDP is consumer spending. When the consumers don't get much money, it's hard to spend it. It's the”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, it is very bad. This level, the level of inequality, income inequality we have in this country, is very bad for economic growth.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“You got so much money, and the more they're using 50% of their net income is used to buy back shares. The share buybacks are twice what they pay in dividends.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, it's a one-to-one correlation. The more you spend on share buybacks, the less you have to put into R&D or put into reinvestment.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Pan a company does billions of dollars a year. Who cares? I mean, so they waste that. That's a small part of the cost. A bigger part of the cost is the effect on company morale. I mean, when CEO is making 500 times what you make and he comes out and he says, there's no I in team and we're all in this together. It's pretty tough for you to swallow. And I mean, this has been proven by study after study that the more the gap, the worse the morale.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, it clearly hurts the companies. I mean, we've talked about how they've cut RD and cut investment to keep their stock price high. A bigger guy, and they, of course, waste tens of millions on the CEO pay. But that's a small part. Now, the pushback is.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, there are two explanations. One is that US CEOs are 30 times more valuable and productive than Japanese CEOs. That would be one explanation. That's a little bit of a”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Long time that tells you how much a trillion is. And you've got $3.7 trillion. Could have been invested in product development, RD, new technology, job training, all these things for long-term health. And instead of doing that, they bought back their own stock. This is eating, this is, America's eating the seed corn. American industry is eating its own seed corn.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I can tell you they cut R&D by 50% over that same period. They cut plant and equipment by 50% over that same period. And I'm going to use something stealing from your book because I thought it was so stunning. When I talk about $3.7 trillion. Trillion is a hard number to get your head around. Reading your book, you had an example that a trillion seconds is 32,000 years. And that to me”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Retire, but they buy it back to keep the price high. They're not buying it back because it's undervalued. They're buying it, it's already high. They're buying it back to keep the price high. What do they spend?”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Between in the last 10 years. SP five hundred Spent $3.7 trillion buying back their own stock Now they buy back their own stock”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, the theory behind that is that the market looks long-term. So your stock price today and in the Chicago school, everything's completely rational. Every actor is completely rational. So your stock price today is the discounted value of dividends plus the stock price 10 years out, et cetera. And it's all perfect. And so the market looks long-term. So that's why you can't have to really look long term because the market will do that for you.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Absolutely, absolutely. And I think, and that school said, okay, stock price is the only thing that counts. So every decision you make should be made by what will maximize the stock price. So you may have to trade today's profits for tomorrow's profits. Well, how much should you do that? Well, look to the stock to the price of your stock. That will tell you how to do it.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Regardless of performance. So to me, this is more something that evolved, but it evolved with two rules. One, the individual part of the machine had to have a certain surface logic, and two, it had to increase the CEO's pay. Each of those were selected for an evolution. So now you have a machine that guarantees that CEO pay will rise eight, nine times faster than the average workers pay.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“I wouldn't use the word scheme because that's as if it were deliberately and conspiratorially designed. What happened is the consultants came in and step by step this machine was built in different things were added. And it's a very complicated system. Now, on the face of it, most of the steps in here by themselves seem to make sense. When you put them all together, they guarantee you with mathematical certainty that the CEOs pay will escalate.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, you have what I have termed the pay machine. And each year the companies crank up this machine. And as I mentioned, it starts with a peer group of highly selected other CEOs making a lot of money. Then the company, quote, benchmarks their CEO. So where does your CEO rank? Well, we're a good company, so everybody benchmarks their CEO at the 75th percentile of this group.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Taking place with CEOs? That's exactly right, except it's a built inspiral. It's not just that it starts inspiring. What happens is you start with your peer group. I told you they assemble a company as well. Surprise, surprise. Companies choose peer groups that have highly paid CEOs.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“CEOs jumping between one large company and another happens about once a year and when they do they usually fail. The failure rate is quite high.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“In the exact same industry. They are not LeBron James. LeBron James can take his skills to any NBA team and improve it. CEOs can't. And there... Only 2% of the Fortune 500 CEOs were previously CEOs of a public company.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly. There is no, in fact, there isn't much of a labor market for chief executives. When you look at chief executives to be an effective chief executive, you have to know a tremendous amount about a single company. You have to know its finances, it's marketing, it's competition, it's personnel, et cetera, et cetera, et cetera. Most of that knowledge is not worth much outside that company. So see if you. Companies rarely, rarely go outside to hire another CEO. 75% of Fortune 500 CEOs were internal promotions.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, let's start with most boards, the majority of people on the board are CEOs or ex-CEOs themselves. Bit of A little bit of tribalism. Secondly, they like to be able to hide behind the consultants and say, hey, we hired experts. We had the best These are people that they love the free market.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source
“The CEOs want to hire the consultants. The boards kind of want to hire the consultants because the boards don't really, they're happy when the CEO gets paid more.”
2017-08-25 · Masters in Business · Steven Clifford Says You Don't Need a Compensation Consultant · IDENTIFIED FROM THE TRANSCRIPT · source