“Pay for Failure” Contracts Irk Shareholders

Nov. 1, 2011 – The practice of rewarding chief executives with wealth has been around since the 1970’s, when corporations would create what became known as “golden parachutes.” These and other tactics, called poison pills, were meant to discourage hostile corporate takeovers.

“From the beginning, big parachutes have stoked some public anger,” writes Scott Thurm in the Wall Street Journal. analyzed company documents and SEC filings regarding pending sales of the companies in question, according to reporter. He says “the clauses are now a common part of executive contracts.”

Recent payments to failed executives include “at least $13 million” Hewlett-Packard awarded Leo Apotheker when they fired him for doing a poor job. In a well-publicized move this September, Yahoo Inc. paid Carol Bartz $10 when they kicked her out.

Original article >>

Be Sociable, Share!

1 comment for ““Pay for Failure” Contracts Irk Shareholders

  1. April 9, 2012 at 9:24 am

    Carol Bartz needs to focus on Yahoo more the company is still bedileng from the poor management and lack of direction it’s had for years.Meanwhile, Google has attempted to diversify, and arguably has failed on every occassion.However, it remains a fact that Google excels in its core market, while Yahoo excels at none.Google brings in the bigger revenues and profits let Yahoo focus on that, before getting cocky.

Leave a Reply

Your email address will not be published. Required fields are marked *

You can add images to your comment by clicking here.