Originally Posted by
cbn42
As often stated, correlation does not prove causation. Being the CEO of a failing company is a much more stressful, high pressure job, and requires bigger decisions to be made with a potentially much greater impact. Being the CEO of a company that is doing well is much easier, and therefore there will be more people wanting such a job, driving the salary down. The CEO is paid more because the company is doing poorly, not vice versa.
In my experience (& on this question, this is something I do professionally, albeit peripherally), what you say simply isn't true.
IME CEO pay has almost nothing to do with existing company performance when hiring. It is most often benchmarked against similar industries and sized companies, regardless of performance and, occasionally, candidate demands are factored into the equation.
You're entirely correct that correlation does not prove causation. Remember, that cuts both ways.