FAT CATS CALLED UPON TO COUGH UP SOME OF THE CREAM
Leaders can inspire greatness through personal sacrifice says Drake Executive.
August 20, 2008 – The heads of Australia’s leading businesses need to tighten their belts and lead by example before asking ordinary workers to bear the brunt of a slowing economy, according to Martin Conboy, General Manager of Drake Executive.
The multi-million dollar pay packets of top-ranked business executives are due some increased scrutiny suggests Conboy, who believes the mark of a true leader is one that inspires front line workers to persevere through tough times.
“True leadership is not about the size of a salary or the scale of a bonus. It’s about whether you can inspire people in your organisation to greatness, even when the chips are down,” said Mr. Conboy. “I fear there is little to inspire the average Australian amongst the leaders of Australian businesses today, because folk perceive that ‘fat cats’ are willing to ask Joe Punter to tighten the belt whilst bloating on huge salaries, corporate perks and bonuses. We’re calling for moderation so that nobody in our society gets left behind.”
Conboy’s call for leadership comes amidst news of record profits for some major Australian organisations, despite the challenges facing regular employees and consumers. Telstra reported a $3.5 billion profit this year but at the same time was reported to be implementing plans to cull 10,000 staff over a five-year period as part of cost cutting measures. The major banking institutions have also had a bumper year financially, but have thus far failed to commit to pass these savings on to customers in the form of lower fees or interest rates, the sum of which only widens the divide between frontline workers and executive decision makers.
“CEOs and executives need to look at the situation, be willing to take a deep breath and tighten their own belts in order to maintain prosperity,” said Mr. Conboy. “A lot of ordinary Aussies are already feeling deep financial strain, and it would be of some consolation if the top end of town prove they are willing to pitch in by making a few sacrifices as well.”
While salary cuts and reductions in head count are an inevitable side effect of market contraction, executives can alleviate some of the pressure by accepting a reduced salary, or a cut in their annual bonus.
“In tough economic times, it is important for companies to make the changes necessary to continue with core functions, but this need not come at the cost of significant layoffs, heavy pay cuts for staff, or a perceived distancing from its customers. Carving off some of the fat would not only ease internal business pressure, but ease public fear of a widening gap in the spread of wealth within our country and can do a great deal to enhance corporate reputation,” said Mr. Conboy.