The parasitic executive scum thread

[Bugs ****ing Bunny]

This thread is something I've been meaning to do for a while. It's a basic fact of business that once one reach the top of a public listed company, your actual performance is irrelevant. Put bluntly, you can be rampagingly useless from day 1 and still walk away a rich man.

That, in itself, sucks. Now I can certainly be accused of bitterness and jealousy, and I'd be the first to admit that I quite fancy the idea of being obscenely rich and breezing up to the Reform Club whilst some strung-out supermodel buffs up her palate on my glans. However what really fires up my Old Testament tendencies is the fact that these handful of tubby little trolls are taking the piss.

CEO and Director's salaries just keep on getting bigger. The logic behind this is that "we have to get the right man" (and it's almost certainly a man) and so the pay must fit. However they'll still get rich even if they drive the company and it's customers to the wall. See where the logic breaks down?

CEO salaries are growing far faster than both average employee wages and average corporate turnovers. These people get a large say in determining their own pay, and they're running public companies as their own personal piggy bank- at the expense of employees, customers and even the shareholders.

This thread is for tales of raging corporate greed. Please bring examples from your country, and let's give these evil little whores a spot of publicity.

[Bugs ****ing Bunny]

This is a good one

http://news.independent.co.uk/business/news/story.jsp?story=373594

Chris Fishwick, the fund manager who left Aberdeen Asset Management with a £1.9m payoff despite many of the split capital investment trusts he ran collapsing into receivership, has been asked to stay on the board of one of its funds.
Mr Fishwick promised to resign from the seven boards on which sat when he announced his decision to leave Aberdeen in October last year.
The chairman of Aberdeen's Smaller Companies Fund, which is worth £28.9m, however, has asked Mr Fishwick to stay on as an independent director. Fred Carr said he wanted to retain Mr Fishwick's services because of his expertise in stockpicking. His reappointment will be subject to shareholder approval.
Mr Fishwick has already stepped down from three boards.
He acted as a representative of Aberdeen, the fund manager running the trust's assets. The FSA has now moved to end this practice so trust boards are independent of their management company.
Mr Fishwick is still at the centre of an FSA inquiry into split capital investment trusts, which were marketed as low risk while they were actually highly geared to the stock market. The regulator is also looking at whether fund managers colluded in a "magic circle" to invest in each other's trusts.

Chris Fishwick marketed precipice bonds as low-risk investments. In fact it went further than that- investors had their savings moved into stock market investments without being informed. Every grey area and borderline tactic was used, and the end result was that thousands of investors have lost everything they invested with Aberdeen Asset Management. These weren't companies who could write off losses to slush funds- AAM marketed to the general public.

Mr Fishwick was finally booted out last year after mounting publicity over customers losing their life savings. He walked away with a golden handshake of nearly two million pounds, and it turns out he's still being paid by AAM. In a more enlightened society he would have been immersed head-down in the excrement of jackals before being set on fire.

[Bugs ****ing Bunny]

Do you have any idea how difficult it is to lose money when you're a British high street bank? It's really tricky. Not one of them reported any annual loss at all for over tem years from 1992, and losses were about as common as coke habits among Carmelite nuns before then. Frankly, any fool could keep them pottering along and making a modest profit. However that's not good enough for some pushy public-school tosser with a greed-induced priapism, is it? Someone like Ian Harley, in fact.
In the time Ian Harley ran the Abbey National, it's share price dropped from £14/share to less than £4/share. If you think that's impressive just keep reading. They have just announced an annual pre-tax loss of .....

.....wait for it....

.......£984,000,000. So after 10 years in which not one British high street bank has reported an annual loss of so much as a single shiny penny, the Abbey has just lost nearly a billion pounds.

Remember the Millennium Dome? How the TV and newspapers were full of stories for literally years about what a catastrophic waste of money it was? £984 million would have paid for it. What's more, Abbey still has around 2 billion pounds sunk in "junks and toxics". So was Mr Harley hounded out of town in rags? Nope.

Mr Harley's pay-off was part of a £6.44m package handed out in compensation and pension contributions to five senior directors who left last year after a series of problems engulfed Abbey, including a black hole in its wholesale bank and weakness in its life business. .....Mr Harley received a £372,000 bonus on top of one-year's salary, amounting to £687,000. He also received £560,000 in pension benefit for his final-salary scheme.

That pension bonus is my favourite. While employees get laid off and shareholders see dividends cut, Mr Harley gets half a million quid purely to ensure he can put his feet up on a full final-salary pension on top of the million pounds he got.

[Ben Kenobi]

"as coke habits among Carmelite nuns,"

Made my day, Laz.

[OneFootInTheGrave]

Thank You

OK... I need to try and find a quopte, but HP/Compaq proxy fight cost HP only ~286 mill USD, Carly of HP and mr Capellas of former Q were meant to make ~ 120 million together in bonuses for the move, and the new board of directors rake in another 100 million for the move, all to be covered with first 15000 redundancies.

Just check would 500 million pay for 15000 jobs of a year or two?

If they had 20000 USD on average than that would be $300 mill a year for all the redundant people, not to take in the restructuring charges and such... how fun... just off top of my head. And my prediction not really a hard one - new HP will be sinking for a long time to come. And spend a cool 1/2 billion on that.

* not Mr Capellas seems to have madew only about 15 million of his 50 million to be as he moved to sinking Worldcom to "save" them a bit prematurely.

[Urban Ranger]

Yes, the revolution is edging closer now.

Greed is our friend.

[Boris Godunov]

http://currentissue.telephonyonline.com/ar/telecom_price_failure/

The price of failure

by by Dan O'Shea

The captain should go down with his ship, rather than stowing away in a dry, cash-lined dingy.

The latest price tag on failure is $12.5 million — the value of the severance package Lucent awarded to former CEO Rich McGinn. He also will receive an almost $1 million annual pension, plus insurance, as well as $9000 per month for the office assistance he will need to find a new job.

McGinn was canned last fall amid embarrassing allegations of financial mismanagement and poor strategic vision. He presided over the worst economic performance in the history of a company that was once the largest — and before that, the only — major telecom equipment maker in the industry. Lucent can virtually be traced to the DNA of Alexander Graham Bell, and McGinn was the leader when it began to fall apart — its stock price plummeting from about $80 to around $6 to $7.

It was McGinn who headed Lucent as it was forced to pre-announce earnings for three consecutive quarters because of unpredicted shortfalls — at a time well before the economic downturn had cut a swath across the telecom industry. Some reports during this time suggested McGinn was too busy trying to rally Wall Streeters to see that Lucent's employee motivation and morale were flagging.

McGinn was the guy who allowed Lucent to get into the private golf course business. Things were so messed up during McGinn's tenure that the SEC is investigating the company. Meanwhile, shareholders and employees are up in arms, and some employees are now suing the company. More than 20,000 employees were laid off by Lucent this year, and many thousands more left, retired early or were laid off prior. Even now, rumors are circulating that more layoffs are imminent.

Making sure these things did not happen was McGinn's responsibility, but they happened. And after presiding over one of the quickest, strangest and most public corporate failures in history, McGinn still gets his millions.

You can say what you want about CEOs deserving every penny they get because it is what the market will bear, or about companies needing to guarantee nice golden parachutes if they want to find good executives to lead turnarounds. You can say CEO jobs are limited (though not so much anymore), and companies need to provide exit pay according to certain standards of living. You also can say that McGinn could have made out much better. His complicated deal gives him $5.5 million in cash and $7 million in stock, but Lucent will buy back that stock to pay off loans McGinn took out with Lucent's assistance. Even so, McGinn will pay Lucent more than $4 million over the next three years to further pay off those loans. You can say this is a typical CEO severance deal, and that much is true. But there should be nothing typical about failure.

The captain should go down with his ship, rather than stowing away in a dry, cash-lined dingy. Tens of thousands have lost their jobs under the leadership McGinn was unable to provide. He is getting too much, and it sets a bad image for current and former Lucent employees — as well as the investors Lucent is trying to woo back.

Were McGinn to have received less cash or no help paying his loans, it would have been a first in CEO severance; it would have made Lucent look cheap. However, Lucent's board of directors, which let McGinn stay in charge much longer than it should have, is now letting him get away with a fat severance, apparently just to keep up appearances. Maybe the directors have not noticed, but Lucent is still a company in a shambles, and a big payout in the midst of such disaster is a slap in the face to Lucent's current and former employees. Boards have been letting CEOs get away with rich severance deals in bad times for too long. Boards, like CEOs, have to be held accountable to those they serve — employees, investors and customers.

There is a price for failure — it's being paid by the thousands who went to work for top companies in any industry and are now out beating the street to find a new paycheck.

[Adam Smith]

Do I sense another Historical Filth thread in the offing?

If so, I nominate Jay Gould for consideration.

[Urban Ranger]

Why not Daniel Drew at the same time?

[SuperSneak]

This one I enjoy particularly because one of the men in question in this article was the Head Vampire at my former employer's HQ. I say former, because some pointy-headed ghoul in Accounting sold back my plant's main consumeable resource (electricity) on the open market during Enron's power shenanigans.

They then used the profits to mothball and "disemploy" the chlorine plant I worked for. The average tenure there was @20 years--most of the employees had no translatable skills or education.
The severance was so generous (though hardly recompense for a livlihood and benefits) that you just knew some corporate thespian was probably flying over you in a golden jet right now, pissing Cristal out the window and throwing feces-stained $100 bills in your direction.

Jean-Marie Messier has secured a multimillion-pound payoff from Vivendi Universal, despite devoting a section of his autobiography to attacking large severance packages for fired executives.

Mr Messier, whose departure will be rubber-stamped at a board meeting today, is reported to have received a golden goodbye worth £11.5m.

It is an abrupt about-turn by the group's former chief executive, who slammed compensation payments for sacked bosses in his book, Moi-Meme Maitre Du Monde [Myself, Master Of The Universe], published two years ago.

He berated Philippe Jaffre, former chief executive of oil giant Elf-Aquitaine, for securing a £19m payoff in the wake of the merger with Total Fina.

"The possibility of being fired... is a part of the normal risks inherent to the job of CEO. My contract has no such clause. And I pledge never to negotiate with my board. You can't have your cake and eat it, too - stock options to build your wealth and a parachute in case things turn out badly," he wrote.

Mr Messier will lose the £11.4m New York apartment bought for him by Vivendi last year, according to the Wall Street Journal Europe.

The payoff is equivalent to three times Mr Messier's salary and bonus last year, although he is believed to need the money to pay off loans taken out to buy Vivendi stock.

Don't the investors complain about this crap? Does anyone wonder why the economy is sinking? The extremely wealthy have pulled their huge money out of the pot already, while the middle class got hung out to dry, convinced by insincere advisors that they should "hang in there".

Thank God I didn't have money to invest before. The losses seem staggering for the average investor, while the big winners cashed out and walked away, taking millions of dollars from failed ventures as their prize for destroying the market.

[Urban Ranger]

Yes, yes, the average Joe is getting pissed. Most execellent.

[Bereta_Eder]

come on baby eat the rich
lalalala these sons of a *****.

having only read the initial thread opening post I'd comment that high wages are grundily ok but it's when they start gaining power to influence politics in a serious manner that it gets really infuriating.
of course that's le monde we're living in.

[Bereta_Eder]

Examples from my country are too numerous to mention.

Particularly in what regards the nefarious and morbid relationship between rich CEOs and the government and the not so transparent competition assignments for building public works.

When there is saying that one of the biggest companies in Greece and the largest telecommunications equipment company in the Balkans will collapse if the government changes, you get the idea.

The nexus is unhealthy. Of course every ****er can have a huge company if it's build and it depends on its sick relationship to state funds no matter how much it proclaims that it is "private".

Of course that's not what you asked but I had to get it off my chest.

Hence is the state of affairs in Greece, sometimes it reminds the french national - social corporate structure. There are positives and negatives.

[Az]

corporations+government=fascism

[Bereta_Eder]

Azazel, only in the mind of a neoliberal.

Look at Britain, they privitized their railroads and the prices have skyrocketed plus the accidents are far more numerous and deadly.

Privitization is not always the best choice and it certaintly is not if it isn't done properly or if the conditions are not good.

In Greece they are public, they are cheap and they are safe. Same as telecommunications (although it now has a competitor), electricity and water.

However privatization vs state -owned companies is not what we're talking about.

We're talking about poor transaprency and unheathly relations between "private" companies and the competitions for the assignement of public works.

That's not what we're talking about either in this thread so no more threadjacking from me