The trouble with share options

WHAT a wonderful time it is to be a boss of a big company. Money pours into your lap. How easy it must be to believe, with John D. Rockefeller, that “the power to make money is a gift of God”—and that your accumulating fortune is the direct and justifiable result of superhuman managerial talent. The truth is usually more mundane. The largest and speediest creation of fortunes that the world has ever seen is taking place mainly because of lucky timing, as executives (particularly Americans) happen to have been around when a greater slice of their remuneration has arrived in the form of share options—the right to buy some of a company's equity at an agreed price, after an agreed length of time. And the buoyant stockmarket has hugely and unexpectedly inflated the value of these options.