Asked by Siyali Singhaniya on Jul 24, 2024
Verified
The key reason that executives earn so much more than other employees is because their base pay is so much higher.
Base Pay
The initial rate of compensation an employee receives, not including benefits, bonuses, raises, or other forms of supplementary pay.
Executives
Senior-level managers within an organization who are responsible for making strategic decisions and overseeing the company's operations.
- Gain an understanding of the determinants of executive remuneration and its connection to organizational scale, efficacy, fraudulent activities, and political ties.
Verified Answer
AM
Akash MinochaJul 25, 2024
Final Answer :
False
Explanation :
While base pay is often higher for executives compared to other employees, the main reason for the large pay gap is typically due to bonuses, stock options, and other forms of performance-based compensation. These additional components of executive compensation can vastly exceed the base salary and contribute significantly to the overall higher pay.
Learning Objectives
- Gain an understanding of the determinants of executive remuneration and its connection to organizational scale, efficacy, fraudulent activities, and political ties.