$1000 an hour: What is it worth?

It appears that it is open season on the heads of public or semi-public firms in Zimbabwe that have been drawing large salaries, or engaging in less that transparent financial activities. The headlines the last week or so have seen a number of corporate heads coming under scrutiny for either taking salaries not commensurate with company performance or for being involved in shady deals. One gentleman had a salary and benefits that was reported to exceed the $1000 an hour mark (given a forty hour working week). Not a bad income at all even after you take taxes into consideration.

Time for Zach to put the cat among the pigeons. If the company the $1000 an hour gentleman was managing was debt free, offering an above average service to its clients that made it a market leader in the field, settling payouts quickly with no shortfalls, paying decent staff salaries to the rest of the organisation; if it was doing all these things, would anyone really care how much the Chief Executive was earning? In such a case would not his performance justify such an income?

A quick search on the internet reveals that, while not the majority, incomes in excess of a thousand dollars an hour are not uncommon. It is complicated by the fact that some professionals that charge that amount (think high-end lawyers and surgeons) have to cover their expenses through their end charges and the reported income of many CEO's has income from shares, benefits and the occasional book sale thrown in to boot.

So here is the question of the week: What would justify a salary of a thousand dollars an hour? I want your feedback. Email me your responses to this informal survey. Before you jump in and yell being President of the United States bear in mind he earns a basic salary of US$400 000 a year before adding benefits and other non-Presidential incomes from things like book sales.

Here are a few things to consider as you plan your response.

How should the income of a top executive of a company relate to the employees under him? Some countries have a very narrow salary spread between top and bottom earners. Morally should the creator of a company be able to sleep at night with an hourly income that exceeds the monthly wage of his employees who are struggling to send their children to school simply because he makes the high risk decisions.

Certain fields carry inherent risk and should be rewarded for such. Take a landmine clearing agent who runs the daily risk of blowing himself up, or the high crane operator that needs to not drop his cargo on the road below or the air traffic controller. You really do not want an air traffic controller being distracted by his inability to pay for his medical insurance as your plane comes in to land.

We live in a world of perceived relative values some of which are rather skewed. For example teachers, those we entrust to educate the next generation, have traditionally been paid less than their true worth. How about the surgeon who is going to take your life in his hands to take out a brain tumour.

To what extent should performance be related to remuneration? Take the surgeon example a step further, what would happen if he only got paid for a successful outcome (now I know most surgeons are not in it just for the money but the example is too good to pass up)?

Now for another perspective on the question. Personalise it. What would you need to do to be worth a thousand dollars an hour? Perhaps that is too far out for you. Many professionals in Zimbabwe work on a fee scale between $50 to $200 an hour (before expenses). So if a thousand is too far out for you to imagine ask what you would need to do to net $200 an hour. What would you need to change in yourself? Where could you see extra sources of income that tick in without you having to work on then (investments, book sales, rental income, that sort of thing)? Now this probably wont be an overnight plan mind you but it is worth a thought, especially if it is the sort of thought that catalysts you into being a better person. I look forward to reading your emails.