AI as CEO very profitable

Human CEOs are not only very expensive. They also deal a lot of damage. An AI as CEO seems to do better.

Disastrous human CEOs

A single failed merger, such as the megalomaniac takeover antics that ABN AMRO CEO Rijkman Groenink has pulled off, and with which he has enriched himself considerably, has already cost the taxpayer billions. An AI as boss? An experiment shows that this wouldn’t even be that crazy.

Board chairpersons very expensive

Board chairmen have a unique talent. At least, that’s what they think of each other. And talent must of course be rewarded. You might say royally rewarded. Because what the CEO of a large company rakes in, often hundreds of millions a year, quickly becomes thousands of times what they pay their lowest paid employees.

A good example is Amazon.com CEO Andrew Jassy, ​​shortlisted for worst CEO of 2022. He earned $213 million in 2021. That’s more than 6,474 average Amazon employees earned in that year.

Also a royal reward for underperforming CEOs

CEOs have a knack for replacing redundant employees with artificial intelligence. In the heartwarming words of Rijkman Groenink: You can be missed. Now the joke is that those superfluous employees are mainly themselves. Even the (according to 24/7 Wall St.) worst performing CEO of 2022, David Zaslav of Warner Bros Discovery, enriched himself with a whopping $ 247 million, more than the inhabitants of the island states of Tuvalu, Nauru and Kiribati have to do with . In return, he let more than $3 billion, and 37% of the market capitalization, go up in smoke in a disastrous merger.

AI as CEO scores much better

It is not for nothing that there is considerable dissatisfaction with board chairmen. They often cause enormous damage, due to an overdeveloped assertiveness combined with a lack of vision. Now you can’t accuse artificial intelligence of having a lot of vision either, but assertiveness, or a swollen ego, artificial intelligence doesn’t have.

This may explain why the new CEO of NetDragon Websoft, a Hong Kong-listed gaming company, is doing so well. NetDragon Websoft is a large company with nearly $10 billion in market capitalization. Tang Yu is responsible for all the typical duties of a CEO of a large company: analyzing high-level analysis, making leadership decisions, assessing risks and efficiently designing the work environment. For all these services she asked for a salary of € 0, and that for a working day of 24 hours a day.

Why? Tang Yu is not a flesh and blood human, but an AI. Since her appointment, NetDragon Websoft’s share price has consistently remained above the Hang Seng index. Especially in 2022, the price increased considerably with a plus of 18.2%, while the rest of the Hang Seng was down 2.8 percent.

Exorbitant salary increases

In the last half century, measured since 1965, CEO salaries have gone up nearly fifteen times. Their employees only improved by a paltry 18 percent in half a century. On average, a CEO earns as much as 400 employees. Not that this helps much in terms of performance. On the contrary.

In fact, the better paid CEOs are, the worse they perform: In a study reported in the Wall Street Journal, the worst-paid CEOs more than triple their company’s value, while the highest-paid CEOs score no more than a little more than a doubling .

A good CEO is able to identify with the long-term corporate interest and selflessly serve the company. Clearly not character traits that fit the personality description of the average CEO.

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