CEO of HP, Meg Whitman had quite a massive pay raise in 2014 as well as her partner is crime, Dion Weisler, Leader of the PC division. With compensation packages of $19.6 million and $13.5 million respectively in 2014. Whitman is reported to be in the middle of a massive layoff course, with HP announcing an expected 50,000 jobs lost as well as more to come by November of this year.
Despite the fact that Whitman has helped HP raise its revenues as well as stock price in the past few years, can a $19 and a half million pay package be justified? How about while having massive layoffs? This ethical dilemma raises many ethical issues from multiple perspectives. This scenario intercepts many fundamental assumptions of modern ethics, with the general notion of fairness and marginal equality disregarded. It displays an extreme exposure to egotism especially when it comes to executives that have enough authoritarian power. Enough power to lay people off and deprive them from their hard earned positions that also provide for 50,000 families, but simultaneously increasing their pay to gross amounts. This action in particular would not be supported by numerous ethical frameworks including virtue ethics and utilitarianism. From the utilitarian perspective, this action deprives the greater good to a minute population, which would be judged as selfish and unrighteous. From the perspective of virtue ethics, we might discover the largest factor to why this dilemma raises so many ethical issues: It encourages and feeds into greed. Perhaps one of the most impactful and non-virtuous characteristics that lead to unethical behavior. It is not unreasonable to also assume that without so many layoffs, that HP can financially afford to pay its executives at such a rate (despite the bonuses these executives obtain from various factors such as stock options). This can also lead to unethical and corrupt behavior such as theft and other crime in the midst of disparity during unemployment.
HP and its executives would attempt to justify their level of compensation by the improvements and advancements that they achieved for their company. While this is not a bad claim to make, it is still important that we stay reasonable in our conversations and arguments. It is understood that individuals that have a greater impact on the financial success of a firm should be paid at a higher rate; it would only make sense due to the increased level of responsibilities and obligations. That said, it is still difficult to justify over $32 million worth of financial gain credited to just two individuals. Dion Weisler received over a 3% pay raise in one year that was already previously set at $9.2 million. He also received a $5 million check to help cover the taxes that were involved in him relocating from Singapore back to HP headquarters in Palo Alto, talk about company-inspired egotism.
This is why it was handled incorrectly, essentially there was no official control or limit to keep things relatively reasonable. There is a call for a financial compensation system for executives that does not include a conflict of interest and a corrupt system of internal control. One that truly benefits the greater good and one that encompasses the interest of a whole organization rather than its top 1 percent.
Source: Business Insider
URL:http://www.businessinsider.com/meg-whitman-got-a-big-raise-and-bonus-2015-2
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