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Joanna Weiss

Nasty business

Those bloated CEO salaries are more than about money — they make the bosses mean

By Joanna Weiss
Globe Columnist / January 23, 2011

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WHEN “AMERICAN Idol’’ launched its new season without Simon Cowell to good reviews last week, culture mavens wondered: Have we lost our taste for meanness?

After all, Cowell defined “Idol’’ for years with his Anglified insults, and launched a wave of TV contests with meanie foreign judges. And this new “Idol’’ panel, so far, lacks his attitude of bored contempt. The New Jersey and New Orleans auditions featured more good singers than basket cases and more praise than insults from the judges. Jennifer Lopez even moaned about the pain of crushing someone’s dream: “Why did I sign up for this? I want to go home!’’

It’s tempting to read this as a trend, a function of post-Tucson reality, when the public no longer will tolerate casual cruelty. Ricky Gervais, comedian and ran afoul of the new national mood when he hosted the Golden Globes last week, hurling nonstop insults at the Hollywood elite — even though it seemed clear that he was satirizing Hollywood’s culture of self-congratulation.

But it’s easy to reject meanness-as-entertainment and pat ourselves on the back. We’re still too quick to accept a lot of garden-variety meanness: powerful people treating less-powerful people badly, because they can.

For instance, in a study published last summer, a group of business-school researchers offered a disturbing way to think about bloated CEO pay. It turns out, it makes the boss mean.

The study examined corporate behavior of 261 companies, and found a striking correlation between pay inequality and poor treatment of workers. Companies whose CEOs made much more than their average workers — in some cases, the disparity is 400-fold — were more likely to underfund pensions or cut corners on health and safety. Often, the bosses engaged in a cost-benefit analysis, figuring that a fine would be less painful than the profits they stood to make if they got away with it.

Those attitudes, researchers say, stem from the way money translates into power, and power into “moral disengagement.’’ A CEO sees his salary as a measure of his worth, and views his employees as relatively worthless.

“You end up basically thinking of those at the bottom as numbers,’’ said Sreedhari Desai, a Harvard research fellow who co-authored the study. “You feel somehow that they aren’t even worthy of the normal people that you’d meet. They’re disposable.’’

To test the theory, Desai and her colleagues conducted an experiment, telling people they were managers, each paired with a single worker. Their job was to decide if the employee should be fired, based on his performance on a test. All workers, it turned out, performed the same. But managers who were told they had much higher scores, compared to their workers, were far more likely to deliver the ax.

What’s most striking about the study is the language it uses to describe executive behavior. Mistreating workers, the researchers suggest, isn’t just a means of maximizing profits, or serving shareholders, or performing some sacred corporate duty. It’s also being mean. Dehumanizing. Wrong.

“Using an emotionally charged word such as ‘meanness,’ it really evokes bullying in the schoolyard,’’ Desai said. “Framing it in an ethics context is important.’’

We all think schoolyard bullying is unacceptable. So why are we so quick to accept it as the way things are on Wall Street or in Hollywood? Everyone giggles at J.Lo’s tabloid-driven reputation for divahood; last summer, rumor had it she was hunting for a personal assistant whose duties would include working 12-hour days, not complaining when being denied a day off, and having a thick skin.

Gervais, who knows about wringing humor from bad bosses, would have fun with that one. And J.Lo’s applicants surely had fair warning. But most workers today have far less choice about who their bosses will be, and what to do if corporate culture dehumanizes them.

If J.Lo treats “Idol’’ contestants as delicate flowers, that will be nice, if boring to watch. How she treats her own employees is far more important. And shifting a national balance of power, through corporate-board reform or stiffer penalties or progressive tax policies, will be much harder to achieve. It all depends on what the public will tolerate: When is meanness an unpleasant social trend that needs to be erased, and when is it business as usual?

Joanna Weiss can be reached at weiss@globe.com.