From the Portland Business Journal, Jim Verdonik takes a lighthearted look at executive compensation:

So, where does this leave executive compensation reform?

1. No law prohibits paying CEOs very, very, very large amounts of money, even if people don't like the idea.

2. The primary penalty for big compensation packages is public shame and embarrassment. The U.S. Securities and Exchange Commission requires compensation disclosure in proxy statements. Newspapers publicize the disclosures. The public moans about greedy CEOs: "What pigs!"

3. "Vote the rascals out!" a traditional cry in American politics, is heard frequently from shareholder activists. The problems with voting the rascals out of the boardroom are similar to the political problems.

First, it's difficult. Voting rules favor incumbents in both political and corporate elections.

Second, new rascals often replace old rascals.

4. Finally, there is the threat of civil liability for directors who approve large compensation packages. This threat has only a modest effect on CEO compensation. Under the business judgment rule, directors aren't liable for making mistakes if they act reasonably in the way they make decisions. Companies that invest time, money and effort in presenting appropriate information to directors, hiring experts and otherwise documenting the compensation process can protect their directors from liability in all but the most outrageous situations.