The New York Times reports that while there has been some meager progress towards reining in the ridiculous sums of money departing (failed) executives extract from their companies, for the most part
the golden parachute remains quite alive and well:
Perhaps the biggest reason that golden parachutes persist is that corporate boards hire superstar chief executives, rather than groom strong managers inside the company for the top job. That gives outsiders a stronger hand to demand all kinds of upfront stock awards and lucrative severance deals when they are hired. So when things do not work out, that “golden hello” turns into a “golden goodbye.” [...]
At Hewlett-Packard, its revolving door for chiefs has led to tens of millions in severance payouts even as thousands of employees have lost their jobs. In 2007, Carly Fiorina walked away with more than $21 million in cash-stock severance, after she struggled to turn around the company. Her successor, Mark V. Hurd, left with severance of more than $12.2 million after he was forced to step down amid accusations of an improper relationship.
Now comes Mr. Apotheker’s $13.2 million severance payout when the stock price was cut in half. That is made up of $7.2 million in cash, the ability to sell $3.6 million of restricted stock and a $2.4 million bonus. H.P., which paid $2.9 million to relocate Mr. Apotheker to California, will now pay to move him to Belgium or France and cover losses of up to $300,000 on the sale of his house.
The next time you get laid off from your job, make sure to ask the company whether they'll be covering any lost equity in your house and/or paying you to move to France. Hey, no harm in asking, right?
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