14.4 Million and the New Class of Top Managers
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Description
EASA Economic Anthropologie Newsletter Post
Date of Publication
2024
Publication Type
Magazine Article
Division/Institute
Subject(s)
Language
English
Description
On 28 March 2024, the Swiss megabank UBS announced its plan to offer a remuneration package of 14.4 million Swiss francs (Eu 14.7M, USD 15.9M) to its new CEO, Sergio Ermotti, for his first nine months (!) on the job. Ermotti, a well-known top manager, assumed the CEO position after UBS acquired its former main competitor, Credit Suisse. It did so with the assistance of the Swiss government, which said that it would cover up to nine billion Swiss francs of UBS risk arising from the acquisition, a measure reminiscent of the massive government bailouts during the 2008 financial crisis. In Switzerland, the decision to pay 14.4 millions to the manager of a bank, whose recent success was at least partly based on government support, sparked controversy regarding why managers like Ermotti are paid so much and how their work can be deemed so valuable.
Neoliberal proponents have justified such salaries by citing ‘international market competition’ for top managers and the ‘great responsibility’ that they bear. However, as anthropologists we must scrutinize what these managers actually do and why their work appears indispensable in the current economic framework. In 2019 I defined management as ‘a mode of governing people or things in accordance with economic ideas and rationales’ (Leins 2019: 91). As evidenced by the work of scholars such as Kimberly Chong, Andrew Orta, Emil Røyrvik and Felix Stein, management practices have come to be seen as pivotal to the contemporary organization of the economy, ranging from small-scale personal management to the activities of transnational business consultants. Managers are taken to enforce economic efficiency and, as Chong aptly demonstrates in her Best Practice, they also play a role in assuming responsibility for success and deflecting responsibility for failure.
What is intriguing about the ascendancy of managers in the present economy is that it necessitates a re-evaluation of power structures within capitalism. If we begin with Marx's distinction between workers and capitalists, top managers present an exceptional case. Technically they are workers, not capitalists. For instance, Ermotti is an employee of UBS, although likely he also is paid partially in UBS shares, which makes him an owner as well. Nevertheless, he probably identifies less with the struggles of average workers and more with the interests of large capital. Ermotti and the emerging class of top managers thus inhabit a position somewhere between workers and capitalists, which illustrates how this simple dichotomy does not adequately capture the complexities of contemporary capitalism.
Currently, a number of anthropologists are exploring the concept of management and the role of managers through ethnography. This inquiry is not only pertinent to understanding the economy but also crucial for understanding things like new forms of state bureaucracy, as well as university management. In these and other spheres, managers end up defining what is efficient and valuable, and hence indispensable. At UBS, Ermotti will be instrumental in shaping the future direction of the bank. His influence, along with that of other managers, warrants scrutiny in economic anthropology.
Neoliberal proponents have justified such salaries by citing ‘international market competition’ for top managers and the ‘great responsibility’ that they bear. However, as anthropologists we must scrutinize what these managers actually do and why their work appears indispensable in the current economic framework. In 2019 I defined management as ‘a mode of governing people or things in accordance with economic ideas and rationales’ (Leins 2019: 91). As evidenced by the work of scholars such as Kimberly Chong, Andrew Orta, Emil Røyrvik and Felix Stein, management practices have come to be seen as pivotal to the contemporary organization of the economy, ranging from small-scale personal management to the activities of transnational business consultants. Managers are taken to enforce economic efficiency and, as Chong aptly demonstrates in her Best Practice, they also play a role in assuming responsibility for success and deflecting responsibility for failure.
What is intriguing about the ascendancy of managers in the present economy is that it necessitates a re-evaluation of power structures within capitalism. If we begin with Marx's distinction between workers and capitalists, top managers present an exceptional case. Technically they are workers, not capitalists. For instance, Ermotti is an employee of UBS, although likely he also is paid partially in UBS shares, which makes him an owner as well. Nevertheless, he probably identifies less with the struggles of average workers and more with the interests of large capital. Ermotti and the emerging class of top managers thus inhabit a position somewhere between workers and capitalists, which illustrates how this simple dichotomy does not adequately capture the complexities of contemporary capitalism.
Currently, a number of anthropologists are exploring the concept of management and the role of managers through ethnography. This inquiry is not only pertinent to understanding the economy but also crucial for understanding things like new forms of state bureaucracy, as well as university management. In these and other spheres, managers end up defining what is efficient and valuable, and hence indispensable. At UBS, Ermotti will be instrumental in shaping the future direction of the bank. His influence, along with that of other managers, warrants scrutiny in economic anthropology.