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.

The Washington Post notes that "Perks Still in Play But Sometimes Are Less Lavish:"

Financial services companies were largely rolling back executive fringe benefits in 2007. But that doesn't mean they were insignificant.

For example, before leaving with a cash severance payment of $3.2 million, Sallie Mae chief executive Thomas J. Fitzpatrick received medical, housing and auto benefits of almost $30,000 last year. Fannie Mae chief executive Daniel H. Mudd got almost $150,000 in fringe benefits, 90 percent related to life and liability insurance coverage and matches for charitable contributions in 2007. His other perks included financial counseling services, an executive health program and dining services.

It's not just executives who eat and travel on the company dime. Often, their spouses do, too.

Freddie Mac, for instance, pays business-related travel and dining expenses for the spouses of top executives.

Negotiating a new chief executive contract is no cheap exercise. Freddie Mac paid $100,000 in legal fees for chairman and chief executive Richard F. Syron to renegotiate his contract last year. He got an 18 percent raise and a $1.25 million extension bonus.

It's common for companies to foot the legal bill for executives during employment negotiations. "Many companies agree that the executives should be represented legally, and as a result they should be willing to pay for counsel for the executive," Hall said. "It's kind of like loading the gun against yourself."

The always attentive The Motley Fool catches this almost unbelievable happening, but given the current state of executive compensation can anything really shock any more?

"Imagine this: You quit your job because you landed a great new gig. To prove there are no hard feelings, your soon-to-be past employer gives you your entirely yearly salary and a few added perks to boot. Sound like a pipe dream? Not at Abercrombie & Fitch (NYSE: ANF), apparently.

Abercrombie & Fitch's Chief Financial Officer Michael Kramer is leaving the company to become CEO of privately held Kellwood. On a related Form 8-K filing, I noticed that Kramer will be paid the equivalent of 12 months of base salary, a whopping $775,000. He will receive earned incentive compensation as of July 21, and accelerated vesting of some outstanding stock awards, along with the continuation of some health-care benefits."

The Detroit Free Press carried a novel, even if slightly unconvincing, article tracing the strange saga of Detroit Mayor Kwame Kilpatrick, who is facing perjury charges and is currently out of jail on bail yet still refuses to resign his office, to the rise of the American CEO:

Blame it on our infatuation with the cult of the charismatic CEO and ultimately on the infatuation of the charismatic CEO with himself.

Iacocca, the glib automotive icon who led Chrysler Corp. through two near-bankruptcies, and Welch, legendary boss of General Electric from 1981-2001, were the first rock-star CEOs. Then Microsoft's Bill Gates and Apple's Steve Jobs ushered in the digital age.

So taken was the American public by these superstars of business that people started asking, "Why can't we run government like we run our private-sector businesses?"

[In 2002], a book was published titled "Searching for a Corporate Savior: The Irrational Quest for Charismatic CEOs" by Rakesh Kurana.

Kurana traced the rise of the American CEO from anonymity to superstar in the last two decades of the 20th Century.

"Previously, CEOs were about as well-known as their chauffeurs," he wrote. "But something happened when Lee Iacocca was credited with single-handedly saving an American icon. Most people forgot about the $2-billion federally guaranteed loan to bail out Chrysler, or the United Auto Workers' givebacks. Iacocca made other CEOs look bland -- there was even talk of drafting him for president.

"The image of a CEO changed from being a capable administrator to a leader -- a motivating, flamboyant leader with a new task. In the late 1980s and early '90s, business tried to redefine itself; it was no longer about the profane task of making money, but concerned with vision, values, mission -- essentially religious terms."

A balanced and well-researched look at the actual ramifications of excessive executive compensation by Awie HW Foong and Mak Yuen Teen of AsiaOne Busines:

[By] compensating millions of dollars to a CEO who has failed to perform, and at the same time laying off the employees en masse, these companies are effectively sending a negative signal about organisational fairness.

The ramification of perceived unfairness is likely to be a long term one. Past studies have shown that the feelings of unfairness would lead to poor employee loyalty and engagement, and consequently poor work performance.

Based on data from the Watson Wyatt's employee opinion surveys in 2004 and 2007, we found that it is the employees' perception of the fairness of the reward system, not how satisfied they are with the rewards, that has the stronger effect on their loyalty to the organisation. The findings suggest that employees want to be treated fairly. That includes a salary and reward package that is equitable to the industry norms as well as a fair process in determining those rewards. Employees also expect that the performance and reward management process is consistent and clearly communicated to them. The study also found that employees who believe that they are being treated fairly are in turn more willing to stay with the company and to make sacrifices for the company during difficult times...

[Also], a recent study by Charles O'Reilly, the Frank E Buck Professor of Human Resources Management at the Stanford Graduate School of Business, together with James Wade of Rutgers University and Timothy Pollock of Pennsylvania State University found that the effects of unfair executive compensation flow down to lower level managers and employees. Managers who perceive that the CEO is unfairly paid are more likely to leave the company.

Proxy Governance, a firm that issues recommendations to large institutional investors on how to vote on proxy matters, has come to a much needed conclusion in the Yahoo! Inc. (NASDAQ: YHOO)-Carl Icahn saga: make some noise about Yahoo executive's unjustified paydays.

In the wake of the much publicized truce between billionaire troublemaker Carl Icahn and Yahoo, the proxy vote over the fate of the board has lost its steam - but Proxy Governance thinks the vote need not go to waste.

"The average three-year compensation paid to the named executives is 480 percent above the median paid to executives at peer companies. In light of Yahoo's relatively weak financial performance, we therefore recommend that shareholders withhold votes from the members of the compensation committee."

The members of the compensation committee, Roy Bostock, Ron Burkle and Arthur Kern, aren't likely to be voted out - but hopefully they'll get the message.

South Africa's Financial Mail looks at the gap between executive and worker pay (note that the figures presented are in South Africa Rand, which currently exchanges for 0.132 U.S. Dollars):

SA's wealthiest and lowest salary earners continues to widen. Figures released by the presidency last week showed that earnings of the average SA worker grew by only 4%/year over the past five years. This contrasts with research by the FM showing that 171 executive directors of the top 40 JSE-listed firms took home R2,7bn last year - nearly R16m each.

The pay gap has become a target of trade unions, which are increasingly citing high executive pay to justify above-inflation-rate demands for salary hikes.

Perhaps a better measure is the amount paid to directors as a percentage of the company's average pre tax profits over the past three years.

For shareholders, anomalies can be seen in companies like Uranium One, which made an average profit of only R18m over the past three years, yet its directors made R76m last year, including a R52m gain from options.

But is it a zero-sum game? Does CEO pay have to drop to narrow the difference? Mark Bussin, chairman of 21st Century Pay Solutions, says there is no proven link between higher levels of executive pay and lower levels of worker pay. " The view might be that you're robbing Peter to pay Paul, but executive pay is still rising faster than the lower levels in countries that are far more equal than SA," he says.

Ultimately, Bussin says, this becomes a moral discussion. "Is it right to pay someone R5m/year and another person R50 000 when they both buy the same food and fuel? " he asks.

In the wake of last month's WSJ article, Human Resource Executive Online takes another look at lavish death benefits for CEOs, also known as "golden coffins:"

Mel Fugate, an assistant professor of management and organizations at Southern Methodist University in Dallas, says golden coffins are yet another symptom of outrageous executive pay that's been tolerated for far too long by shareholders.

"Activist shareholders have been bringing resolutions asking for the right to vote on executive-compensation packages, and they've been voted down in almost every instance," he says, adding that a resolution was easily defeated at ExxonMobil's most recent shareholders meeting.

"In most cases," he says, "the majority of shareholders are large institutional investors and folks who are in bed with one another. They're not interested in change."

Golden coffins have also been pushed by compensation consultants, who are, in many cases, brought in to justify excessive compensation packages, says Fugate.

"They impress upon the board the need to 'stay competitive' with a list of 'comparable firms' by offering these perks," he says. "It's all about keeping up with the Joneses. And no one says, 'No.' "