Peter Drucker, the revered management guru, deplored excessive CEO pay. He argued that CEOs should not be paid more than 20 to 25 times the average salary of company employees. While his approach is schematic, Drucker’s reasons for opposing high executive compensation resonate today even more than during his lifetime. Essentially, Drucker believed that the leadership, motivation and teamwork needed for a successful business are undermined when the CEO is overpaid. He maintained that business leaders should set an example of responsibility, not privilege. He defined the CEO’s role in terms of stewardship, not self-interest.

The financial crisis certainly validated Drucker’s concerns. A Who’s-Who of respected global business leaders have recently gone on record advocating changes in executive compensation. The list includes Paul Volcker, Bill Gates, George Soros, Warren Buffett, Jeff Immelt, Mervyn King — even Allen Greenspan.

Conspicuously absent from the list have been the leaders of Wall Street, and herein lies an important clue to what went wrong, what should be done and why the task is so difficult.

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