That seems pretty much definitional, but many readers of this Washington Post piece, on what is in effect insider trading by top management, may miss this point. As CEO pay has exploded over the last four decades, from 20 to 30 times the pay of a typical worker to 200 or 300 times, many have discussed this rise as though it is somehow in collusion with shareholders.

That makes zero sense. The money that CEOs and top management pocket is money that otherwise could have gone to shareholders. Shareholders have no more interest in CEOs getting big paychecks than they do in seeing assembly line workers or retail clerks getting big paychecks. Contrary to the view that shareholders have been making out like bandits, stock market returns over the last two decades have actually been low by historical standards.

When it comes to reining in CEO pay, shareholders should be viewed as allies. This matters not just because CEOs don't deserve such outrageous paychecks, but because bloated CEO pay affects pay scales throughout the economy. If this is hard to understand, ask a high-level university administrator near you how much they get paid.