It may be too early to conclude definitively, but it appears as though some of the heat has gone out of the 'fat cat' executive salaries debate.
If this is true, one reason may be the new emphasis on Total Shareholder Return as a way of measuring management performance.
As the commentary with our second annual William M Mercer ranking of companies by TSR shows (page 36), more and more companies are linking long-term executive pay schemes to total shareholder return. If a company achieves an above-average performance, which is the goal of all investors, then the management is rewarded.
The key, however, lies in the time period over which the returns are measured. In the past, managements have been criticised, often rightly, for setting up get-rich-quick incentives which benefited them but not, in the long term, their shareholders. On the other hand, managements could argue that institutional investors have had too short-term a focus. The MT/Mercer TSR report looks at performance over a three-year period. This seems about right: any less would encourage short-termism, any more might demotivate managers.
If there is a caveat, however, it is that such schemes may not work for all companies, particularly those in the 'knowledge sector' like Microsoft, 21,000 of whose staff have share options. Companies of this sort, which are likely to increase in number and importance, believe they need to offer incentives far beneath the top layer of management. According to information provided by Microsoft, grants of options over 28 million shares would have depressed earnings per share by some 30% had those options been purchased on the open market. In such circumstances, can the interests of staff really be said to be aligned with institutional shareholders?
The business book as best-seller has been one of the phenomenons of the '80s and '90s. As our feature reveals (page 50), very few are actually written by the claimed authors. Tom Peters, Stephen Covey, Michael Hammer and James Champy - they all use ghostwriters. Management ghostwriting has become one of the growth industries of the late 20th century.
So are we, the readers, being conned or not? At best, we might say that the likes of Tom Peters are only practising what they preach to businesses: the maximisation of a limited resource (ie the author's intellectual property) over as many areas as possible. In this argument, the management guru is best seen as a brand, licensing his or her name.
On the other hand, it's hard to avoid the feeling that, even if the practice is legal, honest, decent and truthful, it's a bit underhand. As any novelist will testify, their work is enhanced by their own blood, sweat and tears.
But then, as the old saying goes, caveat emptor.