Realistically, this is quite rare, especially for public companies. The board hires the CEO and not vice versa.
I'm afraid it will take legislation at the federal level, even though that conflicts with everything I normally believe in, The problem was illustrated in a recent article, maybe it was 60 Minutes, I don't recall. They showed the lifestyle of the CEO of a dairy company in the 1950's. Nice but not regal. Better but not that different from the workers at the company. Then they compared the compensation, etc of the CEO of the company that the dairy became, Dean Foods, as I recall. Multimillion dollar comp package, etc. As different from the current workers as the Russian Tzars were from the serfs. We know how that turned out. There is a mindset that if some corporate weasel worms his way to the CEO suite, he is entitled to compensation rivaling the King of Saudi Arabia. I don't have an issue with Bill Gates or Jobs et al. They built the damn company and are primarily shareholders. I do object to a guy like Aubrey McClendon who built the company but treats it like his personal bank account. The usual answer is "don't buy the stock" if you object, but we don't take that approach to other issues. We think it is appropriate to ban under federal law unsavory practices like bribery, which should also be something the board polices. There are plenty of federal legal restrictions on insider stock transactions, another area you would think the board would take the lead in policing. We ban other socially undesirable activity like discrimination, sexual harrassment, etc. So my solution would be to pass a law that limits executive compensation to some fairly low multiple of the company's average salary. I would ban incentive stock options altogether, on the grounds that they are too difficult to value. Executives should be strongly encouraged by the board to own significant amounts of stock, but they should have to buy it like the rest of us do. That way their interests are aligned with ours. Ideally, I would require that board members also own signficant amounts of stock, say equal to their annual compensation as directors.