It may seem unlikely that Dick Grasso, the deposed New York Stock Exchange chief, who took home a bloated $187 million pay package, would see eye-to-eye with corporate raider turned shareholder activist Carl Icahn (pictured) on the issue of executive compensation and corporate governance. However, Grasso has had some time in "retirement" to think about the issue -- thanks to a prolonged court case related to his golden parachute.
Continue reading below
Deal Journal's Heidi Moore noted Grasso's recent appearance on Bloomberg TV where he said:
The primary source of discipline in executive compensation has and always will lie with the boards of public companies. You better be certain that your managers are compensated in a manner that the public understands. The public doesn't take issue if a company performs well and the stock performs well and the CEO is compensated very highly. The disconnect comes when the CEO is compensated very highly ... and the stock declines.
Take for example comments Icahn made earlier in the month:
Many board members are often beholden to managements for lavish pay and perks they get for very little work and oversight. The credit crisis we find ourselves in is a direct manifestation of board members' lack of oversight. Alarm bells should have gone off in board rooms as crisis loomed, but many boards looked the other way.
Or how about this cherry from Tuesday's Icahn Report?
The problem we face today, however, is that too many of our companies are clearly mismanaged by entrenched and self-serving boards and managers. And there are many laws that have allowed these directors to perpetuate this tyranny, often against the wishes of shareholders, the owners of companies.
OK, so they don't quite see eye-to-eye, but Grasso's comments certainly sounds like Icahn-lite, if you will. - Matthew Wurtzel
Comments
Maybe this is because it is the only logical conclusion.
Sometimes we need to look further then our own greed and take a stand for what we believe is right for the majority of Americans.
I for one agree that not too many will say anything when you deliver and you are highly paid, but when you run a company into the ground and you are highly paid, well that is an insult to those that do produce and it is a reward to those that don't produce leading many people to say, hell if they're going to reward me for failure, I might as well fail.
In my personal opinion, nobody should be rewarded for failure, whether it is a child having a temper tantrum or a corporate officer or politician.
Failure should be rewarded by letting the door hit them in the ass as they're going out and a replacement that can deliver is coming in.
Virgil
http://www.KeepAmericaAtWork.com