Harsh critique says high pay for US CEOs spurred by ‘arms race’ between boards of directors to compensate their top executives BOSTON — US firms often pay their CEOs far too much compared with their lowest-paid workers as boards of directors compete to compensate their top executives more than peers.That harsh critique comes from one of Corporate America’s friends."It would be healthier for our society if CEOs were paid less," said Michael Kagan, who oversees about $9bn in assets at ClearBridge Investments in New York. "You have this arms race, where people look at peers to see the pay is fair, so pay is raised year after year."Even though Mr Kagan’s vehicles such as the ClearBridge Appreciation Fund generally vote to back management on executive pay, he worries that the comparisons companies use to set compensation have helped drive rewards to levels he calls "enormous" as boards look to outdo each other.Mr Kagan’s comments mark a rare exception to the stance of most mutual fund ex...
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