Etsy’s CEO compensation for the discussion. Josh Silverman total compensation for 2021
was $40,584,292, which includes his base salary of $600,000, stock options of
$35,271,412, options awards of $3,599,940, and other compensation of 1,110,940. He is
being paid 175 times the median employee in the company.
In my opinion, are the executives worth it? a In my opinion, I don’t believe the CEO should
have such high compensation unless the CEO founded the company and is a “working”
CEO. What I mean by “working” CEO is one that actually gets into the details of the
company operation and not just a lot of other executives, vice presidents, directors, etc. I
understand that CEO is ultimately responsible for the company, the vision, mission, and
directives are coming from the CEO, but to be paid that high of compensation when the
median employee is making pennies as a base annual salary. For the Etsy CEO, I don’t
believe he should have a high compensation because Etsy is like eBay where sellers post
items for sale on their website. Etsy doesn’t have its own product to sell, it is strictly a
seller-buyer website.
I believe compensating executives with stock or the option to purchase stock is a benefit
for the company. I see it as an incentive for the CEO that if the company continues to
succeed, the value of the stock goes up thus more compensation, based on the stock value,
for the CEO. a If the CEO purchases stock and stock value goes down, then the CEO loses
compensation.
An auditor should obtain information for identifying and assessing risks of the company’s
financial relationships and transactions with its executive officers. (PCAOB AS 12.10A).
In addition to the understanding the company, industry, company’s application of
accounting principles, objectives and strategies, the auditor should also obtain other
compensation records such as compensation meeting minutes or understanding from other
senior management regarding the executive officers compensation.).
AFL-CIO America's Union. (2022). Highest-Paid CEOs. Retrieved from
https://aflcio.org/paywatch/highest-paid-ceos
PCAOB. (2022). Auditing standard No. 12. Retrieved from
https://pcaobus.org/oversight/standards/archived-standards/pre-reorganized-
auditing-standards-interpretations/details/Auditing_Standard_12
