The average CEO makes over 280 times what their company’s line worker earns. This is more than 10 times the ratio observed in the 1970s. Looking just at the salaries and bonuses of Fortune 500 CEOs, financial executives, top university presidents, and even some directors of the larger non-profit organizations, you would think that these leaders are performing at high levels—at least levels high enough to justify their huge compensation. Unfortunately, that's not often the case.

Many executives are paid huge salaries and severance compensation even when their performance is dismal (and brief). About half of these leaders will be out of the job in less than three years. So, if we are not rewarding leaders for their performance, what are we rewarding them for? They often receive their enormous compensation merely because they made it to the top. CEO salaries have been on a meteoric rise for decades, and they are often........

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