It is a shell company, except that it is not Google (or its equivalent) who is creating it. It is the Infosys and Cognizants (or other bodyshopping firms) of the world who create this structure to satisfy the demand created by the Googles.
From the article:
"One theory is that such CEOs are overpaid because they have too much influence over the board that should be monitoring them on shareholders’ behalf and too much influence over the committee that sets their pay."
Something very similar is the theme of the book "The Goal" by Eli Goldratt, which outlines the theory of constraints in a factory setting. The key is to identify bottlenecks and use them to increase/control throughput to match the downstream demand.
