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- Mark Cuban says that companies should offer employees the same kind of stock incentives they give CEOs.Cuban has long been a fan of companies sharing the spoils with employees.The wage gap between CEOs and workers has widened significantly in the past few decades.
Mark Cuban said on Sunday that employees, not just CEOs, should receive a proportional cut of their companies' success in the form of stock options.
Cuban was responding to several posts on X that criticized the growing wealth of top business executives compared to the average worker. He said the real issue wasn't the ever-increasing net worth of billionaires but how companies reward employees.
In his X post, Cuban wrote that billionaire wealth levels are soaring "because the stock market has gone straight up."
"You know who is funding the increase, particularly lately? Retail investors. 401ks," Cuban said.
"The better question is why are we not giving incentives to companies to require them to give shares in their companies to all employees, at the same percentage of cash earnings as the CEO?" he added.
Cuban did not respond to a request for comment from Business Insider.
Cuban said in an earlier post that successful entrepreneurs derive less satisfaction from money "once your LIQUID net worth becomes high enough."
"The value of those dollars becomes much greater, to you, and so many others, when you use your business or other expertise to help others. That is the greater reward," Cuban wrote.
"Compassion and capitalism, not greed, are what can make this country far greater," he added.
Cuban has long espoused the importance of companies divvying up the spoils with their rank-and-file employees.
In 2020, Cuban said on the "This is Working" podcast that companies looking to emerge stronger after the COVID-19 pandemic should give their employees stock.
"You will get more from your employees, and they will be more committed if you share equity immediately in a meaningful way, so that everybody rises up," Cuban said.
"No entrepreneur can do this alone. You need every single employee committed to helping you get through this, so recognize that. Reward them for it," he added.
Last year, Cuban said in an X post that "300 out of 330 employees" at his streaming company, Broadcast.com, became millionaires after he sold it to Yahoo for $5.7 billion.
He also shared profits with his employees at his first business, Microsolutions, a software company. After selling the company for $6 million to CompuServe, Cuban said he shared 20% of the sales proceeds with 80 employees.
"In every business I've sold, I've paid out bonuses to every employee that was there more than a year," Cuban wrote on X in June 2024.
Last month, the American Federation of Labor and Congress of Industrial Organizations said in a report that S&P 500 CEOs earned 268 times as much as their median worker in 2023. The average CEO made around 30 times what the average worker made in 1978.
In September, Tesla proposed a new $1 trillion pay package for its CEO, Elon Musk, if he could raise the EV giant's market cap to $8.5 trillion by 2035. Tesla's current market cap is around $1.3 trillion.
"If he performs, if he hits the super ambitious milestones that are in the plan, then he gets equity — it's 1% for each half a trillion dollars of market cap, plus operational milestones he has to hit in order to do that," Tesla chair Robyn Denholm said in a CNBC interview about the proposal.
