In our egalitarian society, few of us like to acknowledge that double standards exist. As a hot button issue, the idea brings up strong and immediate impressions of social injustice and special treatment. Tax breaks for the rich. Military deferments for the well-connected. Legacy appointments to elite colleges for the children of the wealthy. Affirmative action or racial profiling for minorities. We’d prefer to believe that the existence of various forms of the double standard are either anomalies of privilege or temporary bandages for righting old wrongs.
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CEO’s are treated differently in many different ways. Unlike ordinary mortals, they do not wait in lines or worry about petty rules that must be strictly adhered to by ordinary employees. When budgets are tight, don’t expect the CEO to fly coach even though everyone else must. In a non-smoking office, don’t be surprised to see the CEO enjoying a cigarette during a meeting.
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Why are executives surprised by negative reactions to their own double standards? Because the double standard is very standard to them.
CEO pay is the most egregious example of any perceived double standards in today’s business world. The sheer numbers boggle the mind. Ten million dollars in salary, twenty million in bonuses, a hundred million or so in stock options… How can one person in an organization be worth that much money? Why would they even want that much? What could they possibly spend it on? When you throw in the perks and payoffs that go with the dollars, the sense of disproportion becomes surreal. Not just the money but also a private Lear jet, a five million dollar pied a terre, a dozen country club memberships, a two hundred acre summer home by the sea, laundry service, music lessons and pet grooming! Even more damaging, the information about such trappings of power seems to be released when the executive is under pressure over poor company performance. This confirms a general impression that Nero has been fiddling while Rome burns.
Harvey Golub, former CEO of American Express, used to smoke in his office. Golub was a great CEO, a powerful personality, a very effective leader, highly appreciated by his employees, shareholders and competitors. So what made Golub’s smoking habits problematic? Well, American Express is a smoke-free building. Was Golub aware of how negatively this abuse of privilege could have been perceived by others? In fact, he couldn’t have cared less. He was a disproportionately important figure in the organization who happened to have a nicotine addiction. If feeding that addiction meant keeping his organization running well at the expense of some politically correct notion about double standards, then Golub was okay with that. In contrast, I recently heard a story about the executives of Wal-Mart. The company itself is notoriously frugal and concerned about the impact of costs on the bottom line. Despite their busy travel schedules, the executives that lead the largest corporation in the world, stay at cheap hotels when traveling. To do otherwise would be to risk violating a value and creating the impression of a double standard.
