Today, the elite of the Arabian Gulf’s executive cadre will gather at the Top CEO Conference in Saudi Arabia, to mull over and deliver insights on some of the weighty business and economic matters facing the region. Organized by Trends magazine and Insead business school, the conference will consider such vital issues as leadership, the challenges of slow growth, the role of women and the place of public-private partnerships in the modern business world. It will also deal with broader strategic questions like artificial intelligence and the image of the Middle East projected to the rest of the world.
It is the first time the conference has been held in Saudi Arabia, and the timing could not be more appropriate. With the Kingdom in the midst of profound transformation in business and economy, it is the ideal opportunity to view those vital C-suite issues through a Saudi prism.
I am looking forward to taking part in the events, and believe I will get more out of the occasion than many of the other big set-piece executive theatricals that punctuate the business calendar. Each January in Davos, Switzerland, the World Economic Forum kicks off to the tune of the CEO Survey conducted by accounting firm PWC. Last winter was its 20th year, which PWC seemed to mark by virtually ignoring the Middle East. So the gathering at King Abdullah Economic City, near Jeddah, is performing another crucial role in homing in on the Gulf region and the wider Middle East, which PWC apparently forgot. Maybe it was just an oversight this year. The region certainly has figured in PWC’s studies in the past.
I have attended a good few of the PWC Davos events over the years, and must say I feel the approach needs an all-round refresher. The methodology is sound, the sample size (just short of 1,400 chiefs) is impressive, and the presentation slick.
But the content is getting stale. Each year CEOs are getting either more or less confident about the state of the global business scene, but usually by a very small percentage either way; they nearly always view their own company’s prospects better than the sectors or economies as a whole; and they are always concerned about regulation, disruption and finding talent.
CEOs probably do think about these worthy subjects, but I am sure that they also like to look good as a class of people involved in global surveys. If they were all to respond that their main preoccupation was in making sure they got paid as much as they possibly good, it would not reflect well on the profession of CEO, would it?
Pay on the rise: That is one conclusion that can be drawn from recent research. Despite all the variables of the business cycle in recent years — crises, crunches and crashes — the one dependable trend seems to have been the inexorable rise in CEO salaries. A recent study by American workers’ organization AFL-CIO concluded that the average pay for a CEO at an S&P 500 company in 2015 was a staggering $12.4 million. That’s the average, note, which means many of them will be getting well above that amount. That is 335 times higher than the salary of an average worker, the study concluded, and it has been steadily increasing over the years. In 1980, before the leadership cult of the CEO took hold, the average top boss was paid just 42 times more than his workers. You might say that in a free market system bosses are justified in squeezing every last dollar out of employers desperate to pay for unique talents. But such disparities of income are at the heart of the debate over inequality, which has taken off since the 2009 financial crisis, and which is threatening to destabilize political systems all over the world.
The trend of increasingly exorbitant CEO pay has come under attack recently from some powerful but unlikely allies. Donald Trump, before he became US president, called executive pay levels “disgraceful.”