C.E.O.'s Salaries

[Dynion Araf Uchaf]

Tankrizzo said:

Absolutely does happen - I was at HP during this guy's short (10 month) tenure as CEO:

https://en.wikipedia.org/wiki/L%C3%A9o_Apotheker

Company lost 30 billion dollars in value during his ten months there due to decisions he made. For those ten months' employment, he got:

$13 million in pay
shares worth $3.56 million
performance(!) bonus of $2.4 million
and severance payment of $7.2 million

not bad for ten months and fking up a company.

I guess the chemistry must have been wrong.

[smifffymoto]

Very good,I fear it will be missed by most.

[Tankrizzo]

Dynion Araf Uchaf said:

I guess the chemistry must have been wrong.

Chapeau.

[crankedup5]

ettore said:

crankedup5 said:

FTSE Board compensation is heavily scrutinised, of course it is. The question is who makes up these Boards? School tie and back scratching by any chance? Not so long ago we had the ‘Shareholders Spring’, plenty of scrutiny and the findings were unsavoury, hence the disquiet and protests at Annual shareholders meetings.

No, the world has moved on from the 1950’s.

Being deliberately obtuse does you no favours to you or your pov.

[anonymous-user]

DanL said:

Roman Rhodes said:

The above needs perspective. It may have some relevance to publicly quoted companies, although I think the idea that the majority of CEOs are White Knights coming over the hill to save the business somewhat risible (plenty are appointed through the usual succession planning processes). However, it is certainly not the case in many private limited companies, particularly when a small business has expanded beyond the capabilities of the founder(s) and the shareholder(s) are reluctant to hand over any control whether the business is running ok (but could be better) or poorly.

Small to medium sized businesses are unlikely to be paying their CEOs millions of pounds though…

And the large ones? Some can and do.

[DanL]

Roman Rhodes said:

DanL said:

Roman Rhodes said:

The above needs perspective. It may have some relevance to publicly quoted companies, although I think the idea that the majority of CEOs are White Knights coming over the hill to save the business somewhat risible (plenty are appointed through the usual succession planning processes). However, it is certainly not the case in many private limited companies, particularly when a small business has expanded beyond the capabilities of the founder(s) and the shareholder(s) are reluctant to hand over any control whether the business is running ok (but could be better) or poorly.

Small to medium sized businesses are unlikely to be paying their CEOs millions of pounds though…

And the large ones? Some can and do.

Well, yes…

Our friend here was saying that a number of CEOs aren’t adding the value being described elsewhere in the thread. My point is rather that the ones not adding the extra tens / hundreds of millions to the bottom line are unlikely to be being paid more than a million.

I’ll grant you that not every CEO on a million plus is worth it, but that’s a different argument.

[Muzzer79]

Talksteer said:

There is no other field for those who would be CEOs to jump into, ergo if salaries were 1/10th what they are now most likely the same people would be in leadership positions.

This is another post that surely can't be serious?

[crankedup5]

The former CEO of persimmon homes was rewarded with a bonus of £90million thanks to a Government policy that encouraged starter homes to be built. The CEO was in the right place at the right time. The bonus contract didn’t stipulate a maximum payment- bingo, And they say these people are smart

[S17Thumper]

crankedup5 said:

ettore said:

crankedup5 said:

FTSE Board compensation is heavily scrutinised, of course it is. The question is who makes up these Boards? School tie and back scratching by any chance? Not so long ago we had the ‘Shareholders Spring’, plenty of scrutiny and the findings were unsavoury, hence the disquiet and protests at Annual shareholders meetings.

No, the world has moved on from the 1950’s.

Being deliberately obtuse does you no favours to you or your pov.

It is a pretty old world ‘Rover-esque’ view. Particularly if you’re talking the realms of FTSE250 type places

Maybe at Rover a few decades ago though!

[Talksteer]

Muzzer79 said:

Talksteer said:

There is no other field for those who would be CEOs to jump into, ergo if salaries were 1/10th what they are now most likely the same people would be in leadership positions.

This is another post that surely can't be serious?

I will flip that around, since CEO salaries have vastly increased in the last 30 years what talent pool has it uncovered that was not previously available?

As far as I can see the only people earning comparable or greater amounts are owners and founders and there is very little cross over between those career paths.

[speedyman]

Dynion Araf Uchaf said:

Tankrizzo said:

Absolutely does happen - I was at HP during this guy's short (10 month) tenure as CEO:

https://en.wikipedia.org/wiki/L%C3%A9o_Apotheker

Company lost 30 billion dollars in value during his ten months there due to decisions he made. For those ten months' employment, he got:

$13 million in pay
shares worth $3.56 million
performance(!) bonus of $2.4 million
and severance payment of $7.2 million

not bad for ten months and fking up a company.

I guess the chemistry must have been wrong.

The CEO Mark Hurd before him wasn't much better. In 2008 Mark Hurd CEO of Hp, total compensation was $39,952,237, including a base salary of $1,450,000, stock award of $7,907,660, cash bonus of $23,931,882, and $662,695 in perquisites and other compensation.[19] It was the largest bonus of any CEO in 2008,.[20] In 2009, Hurd made a total of $24,201,448, including a base salary of $1,268,750, stock award of $6,648,092, cash bonus of $15,809,414 and $475,192 in benefits and other compensation. During the 2009 recession, depending on job role Hurd imposed a temporary 5%, 10% or 15% pay cut on all employees and removed many benefits. He himself took a base salary pay cut of 20%, although the compensation committee increased his bonus by the same amount.

Later resigned for fiddling expenses and (allegedly) sexual indiscretions.

Edited by speedyman on Friday 27th May 20:13

[blueg33]

crankedup5 said:

The former CEO of persimmon homes was rewarded with a bonus of 90million thanks to a Government policy that encouraged starter homes to be built. The CEO was in the right place at the right time. The bonus contract didn’t stipulate a maximum payment- bingo, And they say these people are smart

Nope. It was mainly due to extensive and well secured strategic land and some high risk sites that were effectively bought very cheaply before his tenure.

[ettore]

blueg33 said:

Nope. It was mainly due to extensive and well secured strategic land and some high risk sites that were effectively bought very cheaply before his tenure.

Don’t challenge the ignorance with facts!!!

[lauda]

blueg33 said:

crankedup5 said:

The former CEO of persimmon homes was rewarded with a bonus of 90million thanks to a Government policy that encouraged starter homes to be built. The CEO was in the right place at the right time. The bonus contract didn’t stipulate a maximum payment- bingo, And they say these people are smart

Nope. It was mainly due to extensive and well secured strategic land and some high risk sites that were effectively bought very cheaply before his tenure.

It was also due to the fact that the government will move heaven and earth to make sure we don’t have the house price crash that the massive bubble that is our housing market deserves and arguably needs.

The remuneration committee were also a bunch of incompetents.

[crankedup5]

blueg33 said:

crankedup5 said:

The former CEO of persimmon homes was rewarded with a bonus of 90million thanks to a Government policy that encouraged starter homes to be built. The CEO was in the right place at the right time. The bonus contract didn’t stipulate a maximum payment- bingo, And they say these people are smart

Nope. It was mainly due to extensive and well secured strategic land and some high risk sites that were effectively bought very cheaply before his tenure.

Your game, but land banking has been the backbone of shysters in the development game for decades. It’s one of the greatest travesties of U.K. home building, greedy developers holding back development of homes with the consequence of inflating house prices on cheap land purchased years prior to developing.
The former CEO simply struck lucky with all his cards falling into place to benefit him personally with zero extra effort or skills on his part.
Idiots who gamed his bonus contract really delivered the ultimate by not capping his bonus payment.

[crankedup5]

S17Thumper said:

crankedup5 said:

ettore said:

crankedup5 said:

FTSE Board compensation is heavily scrutinised, of course it is. The question is who makes up these Boards? School tie and back scratching by any chance? Not so long ago we had the ‘Shareholders Spring’, plenty of scrutiny and the findings were unsavoury, hence the disquiet and protests at Annual shareholders meetings.

No, the world has moved on from the 1950’s.

Being deliberately obtuse does you no favours to you or your pov.

It is a pretty old world ‘Rover-esque’ view. Particularly if you’re talking the realms of FTSE250 type places

Maybe at Rover a few decades ago though!

And yet we see the likes of Carillion, headed by Masters of Business, take the piss and ruin so many small businesses with their own special brand of expertise. Tell me how that occurred !

[crankedup5]

ettore said:

blueg33 said:

Nope. It was mainly due to extensive and well secured strategic land and some high risk sites that were effectively bought very cheaply before his tenure.

Don’t challenge the ignorance with facts!!!

We all know land banking by greedy developers has added to the cost of building, but don’t let facts get in your way.

[S17Thumper]

crankedup5 said:

S17Thumper said:

crankedup5 said:

ettore said:

crankedup5 said:

FTSE Board compensation is heavily scrutinised, of course it is. The question is who makes up these Boards? School tie and back scratching by any chance? Not so long ago we had the ‘Shareholders Spring’, plenty of scrutiny and the findings were unsavoury, hence the disquiet and protests at Annual shareholders meetings.

No, the world has moved on from the 1950’s.

Being deliberately obtuse does you no favours to you or your pov.

It is a pretty old world ‘Rover-esque’ view. Particularly if you’re talking the realms of FTSE250 type places

Maybe at Rover a few decades ago though!

And yet we see the likes of Carillion, headed by Masters of Business, take the piss and ruin so many small businesses with their own special brand of expertise. Tell me how that occurred !

No idea, you’re the one who’s never wrong it would seem

[speedyman]

Fred Goodwin of RBS fame, another CEO paid millions and wrecked the company by his actions. There not all the supermen some seem to think.

[RDMcG]

When investors are dissatisfied with CEO performance then the CEO is toast. In the end, the investors are the owners of the company and if they are satisfied with the performance under the leadership of that CEO they will pay wth most of the comp being options/ performance bonuses. The base pay is trivial.

Thus there is an incentive for the CEO to produce results. IF they have huge bonuses or options arising from the increase in the value of the company, then nobody complains.