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Why C Suite Executive Salary So High

Why C Suite Executive Salary So High?


A C suite executive salary is so high because he is responsible for strategic decision making. He also liable for business failure and success. In a word, a C suite executive contributes to successfully run day to day operation of a business.

What do you mean C suite executive?

C suite executives are Chief Officers category’s employees. For example:  Chief Executive Officer (CEO), Chief Financial Officer (CFO), Chief Operating Officer (COO), Chief Marketing Officer (CMO), Chief Information Officer (CIO), and so many. These C level executives lead the particular segment and he is the sole boss for his segment.

To illustrate, a CFO has the supreme power about financial issue and he directly reports to CEO. Accounts and Finance managers and officers work under CFO. In C level executives, CEO is the main boss for C suite umbrella, and he is liable to board of director. Other C categories executives directly report to CEO.

Why does a C suite executive pay so high?

To get the answer, you should read the next section carefully.

Responsibilities of a C suite executive

Think about Chief Marketing Officer (CMO). He leads marketing managers to marketing field officers. As he supervises the large team, his leadership skill helps to achieve whole team performance.

Whenever any marketing team member makes any mistake, CMO has to correct at his own risk. His boss- CEO- never asks marketing officers about any unsuccessful attempt instead CEO queries from CMO.

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As a C Level executive has decision making power, he has high risk to make any wrong decision and has huge responsibility about business success and failure. So, his remuneration is higher than his subordinates.

Why CEO is the boss of other C suite executives?

A company’s governance structure consists of board of directors, C suite executives and officials. Board of directors assign task to CEO. Then CEO divides the work among other C level Executives. Further, C level executives assign works among managers and officers.

CEO leads the C suite team so that whole C suite team can achieve strategic goals for the business. Thus, a CEO runs the business and takes all necessary decision.

What happens if CEO make a wrong decision?

Let’s cite an example to clarify:

Mr. X is the CEO of LoveBy company. Recently he takes a decision to start a new venture. He has convinced the board members for 50 crores cold drink business startup.

Event 01:

Within six months, he has managed to get back 50 crores investment as cold drink business ran well. From another six months, he has generated 100 crores revenue from new venture. Board of directors has become satisfied for this outstanding success and has increased his salary by 15%.

Event 02:

His new project failed. He has to stop the business and company has counted loss to 30 crores. Board of directors has become displeased. As a result, he was fired from the company.

If you observe the two events, you can realize why does a CEO salary is high. Similarly, any other C Level Executive has also responsibilities like CEO. So, they are paid high.

They have power to change the present business situation. If an organization belongs a qualified C suite team, this organization will lead the market. Their combined efforts will defeat the competitors.

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Qualification of C suite Executives

Generally, C level executives have both strong educational background and professional excellent track records. In order to get a seat in C suite car, they have to show career excellent. Moreover, they have both decision making and inter-personal skill.

They are the team players, who have leadership and communication skill. Professional successful track records are the core foundation to reach this position.

In Conclusion

If a person can contribute to generate 200 crores profit, he also can expect 1 crore salary. Based on level, a C level executive contributes hundred to thousand crores in a business.  As they generate profit, they can expect high salary.  

Founder of The Financial Ask


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