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FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

3 edits
reply to morbo

Re: Pay for performance is just for the little fish, eh?

said by morbo:

Where is the logic in doubling this guy's salary? I know it's the titanic he's driving, but still. That is pretty dumb even for Charter.
As a stockholder in many companies I don't want to see overpaid execs even more so than many people here that hate corporations.

BUT, please remember that Charter probably didn't have any choice in what they paid the CEO in 2008. When he was hired the company signed a CONTRACT with his compensation no doubt laid out in pages of excruciating detail and checked over by a group of lawyers hired by Smit. They had a choice when negotiating the contract, but after that their hands are tied.

So, don't look for logic when trying to understand why an under-performing company doubled a CEO's salary after a bad year. That ship no doubt sailed before 2008 results were known.

What is needed are Boards of Directors that negotiate CONTRACTS that are tied much more tightly to meeting profit goals and not just the desire to get a so-called superstar CEO. And there should be terms that allow firing without any golden parachutes if the goals aren't met.

Will that mean, the Board won't always get the person they want? YES!! But if more Boards followed this practice, then prices will come down on CEO salaries and more accountability will be in the contracts.
--
My BLOG .. .. Internet News .. .. My Web Page


Rogue Wolf
Mourns the Loss of lilhurricane

join:2003-08-12
Troy, NY

2 recommendations

said by FFH5:

What is needed are Boards of Directors that negotiate CONTRACTS that are tied much more tightly to meeting profit goals and not just the desire to get a so-called superstar CEO. And there should be terms that allow firing without any golden parachutes if the goals aren't met.

Will that mean, the Board won't always get the person they want? YES!! But if more Boards followed this practice, then prices will come down on CEO salaries and more accountability will be in the contracts.
Yes, yes, a thousand times yes. Boards need to think beyond the next quarterly report and set up a beneficial long-term strategy for the company for which they are responsible. Getting a 'big name guy' in the CEO's chair should matter much less than getting someone who can be trusted to grow the company responsibly. Millions of people go to work every day knowing that their compensation and continued employment depend on how well they execute their responsibilities... why should CEOs be any different?

It's good to see that at least one stockholder sees things from the same viewpoint as us "little guys", FFH5 See Profile.
--
Hexadecimal humor really turns me 0FF.


koitsu
Premium,MVM
join:2002-07-16
Mountain View, CA
kudos:23

1 recommendation

reply to FFH5
said by FFH5:

...
So what you're essentially saying is that the "business concept" -- that is to say, the methodology used to decide and negotiate said CEO's salary -- is flawed. If so: I'll agree with that.

But if that's true, I'm wondering why you own shares of any company? Seems you'd be smarter than to risk investing in something that's as shaky as stocks.

I'm one of those people that says "stock isn't real/worth anything until its cash in your bank account". This blows the minds of most people, especially those who put a lot of focus on stock and options. I don't believe in the stock market as a whole (read: I don't believe it's an effective economic environment), because all it amounts to these days is a form of legalised gambling. Every person -- I repeat, every person -- I know who owns stock in companies or "plays the market" is doing so for one reason: to try and make money. They really couldn't care less if there's economic repercussions from this idiocy (like said CEO's contractually-negotiated salary) -- they just want their money. The company they invested in fails? They still want their money. It's like a casino where no one loses... except those who don't go to the casino. Someone has to lose, and "who cares, as long as it's not me!"

Please don't take what I say on a personal level (honestly, please don't), I just think the sooner we stop basing our economic stature around something as fallible as the stock market -- which indirectly means hiring CEOs like this chucklef*** and other whatnots, ditto with allowing these fools to be given such large sums of material wealth (whether it be in shared or in cash) -- the sooner the country as a whole will be better off. Today's mentality behind how to build a company and how to run a company is bad, because the driving force is bad.

Even if Smit was to quit Charter right now and walk, he'd be hired at some other company (and probably not a start-up) to "fix things", and continue his downward spiral, destroying things as he goes. What is it going to take for people to put a lid on folks like this? Seriously: these people can walk in, destroy a company, and walk out like there's no repercussions of their decisions or actions. Don't argue with me either, because this kind of "business behaviour" has been going on for quite some time now.

I seriously feel like the only person on Earth who doesn't focus on monetary or material gain. If I want money, I work 40 hours a week, and do actual effort. If my efforts are crap, I'm fired -- it's that simple. And that's exactly how it should be when it comes to these shmucks...
--
Making life hard for others since 1977.
I speak for myself and not my employer/affiliates of my employer.

patcat88

join:2002-04-05
Jamaica, NY
kudos:1
reply to Rogue Wolf
said by Rogue Wolf:

Yes, yes, a thousand times yes. Boards need to think beyond the next quarterly report and set up a beneficial long-term strategy for the company for which they are responsible. Getting a 'big name guy' in the CEO's chair should matter much less than getting someone who can be trusted to grow the company responsibly. Millions of people go to work every day knowing that their compensation and continued employment depend on how well they execute their responsibilities... why should CEOs be any different?
Boards don't think. They show up reluctantly once or twice a year for a few hours since they are paid little if anything. They never read in deep, or have someone from the corp explain to them the proposals by phone the day before to get rubberstamped the next day. All the members have day jobs at other fortune 500s or in govt. Boards only exist to recruit investors and job placement obligations for their college frat/secret society buddies.


FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5
reply to koitsu
said by koitsu:

Don't argue with me either, because this kind of "business behaviour" has been going on for quite some time now.

I seriously feel like the only person on Earth who doesn't focus on monetary or material gain. If I want money, I work 40 hours a week, and do actual effort.
Who could argue with you? Your mind is made up. Why bother?
--
My BLOG .. .. Internet News .. .. My Web Page


FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5
reply to patcat88
said by patcat88:

They show up reluctantly once or twice a year
quote:
Most boards meet much more than that- often once or twice a month in person and more frequently by phone
for a few hours since they are paid little if anything
quote:
I wish that were true. Benefits for board members often run to tens of thousands of dollars per mtg
. They never read in deep, or have someone from the corp explain to them the proposals by phone the day before to get rubberstamped the next day.
quote:
unfortunately for many board members that is true
All the members have day jobs at other fortune 500s or in govt.
quote:
Some do. But many are retired CEOs, CFOs, etc and most boards now have members from academia & community organizations
Boards only exist to recruit investors and job placement obligations for their college frat/secret society buddies.
quote:
some truth in that statement, but they do have fiduciary responsibilities that many take seriously. They can be sued if they don't act in a legal manner

--
My BLOG .. .. Internet News .. .. My Web Page

patcat88

join:2002-04-05
Jamaica, NY
kudos:1
reply to koitsu
said by koitsu:

I seriously feel like the only person on Earth who doesn't focus on monetary or material gain. If I want money, I work 40 hours a week, and do actual effort. If my efforts are crap, I'm fired -- it's that simple. And that's exactly how it should be when it comes to these shmucks...
Sounds like you want a capitalism/bourgeoisie free world, goto Laos, North Korea, Cuba, or Burma.

Making money by only owning money is the american way. If that doesn't work, start a bank, and print money yourself (federal funds loan currently .25% APR / sell 39.95% APR loans to anyone with a SSN and a pulse, then securitize the loan away), or you can do the old fashioned insider trading, and split the profits with the CEO through a Cayman bank account.


P Ness
You'Ve Forgotten 9-11 Already
Premium
join:2001-08-29
way way out
Reviews:
·Comcast
reply to FFH5
said by FFH5:

said by morbo:

Where is the logic in doubling this guy's salary? I know it's the titanic he's driving, but still. That is pretty dumb even for Charter.
As a stockholder in many companies I don't want to see overpaid execs even more so than many people here that hate corporations.

BUT, please remember that Charter probably didn't have any choice in what they paid the CEO in 2008. When he was hired the company signed a CONTRACT with his compensation no doubt laid out in pages of excruciating detail and checked over by a group of lawyers hired by Smit. They had a choice when negotiating the contract, but after that their hands are tied.

So, don't look for logic when trying to understand why an under-performing company doubled a CEO's salary after a bad year. That ship no doubt sailed before 2008 results were known.

What is needed are Boards of Directors that negotiate CONTRACTS that are tied much more tightly to meeting profit goals and not just the desire to get a so-called superstar CEO. And there should be terms that allow firing without any golden parachutes if the goals aren't met.

Will that mean, the Board won't always get the person they want? YES!! But if more Boards followed this practice, then prices will come down on CEO salaries and more accountability will be in the contracts.
so you dont know the little secret huh?
how must board members used to be CEO's....and how they work together to make sure they help each other out...regardless of how retarded the contract is.

every contract i sign with my clients and employees have performance clauses, "for cause" clauses, and other tools that let me really stick it to people who fuck up and fuck up badly....but for some reason these CEO contracts are iron clad always in favor of the CEO.

its even worse then baseball.

the corporate structure at most companies now is just one big joke of making as much money as you possibly can and getting out with a can full of gold
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moonpuppy

join:2000-08-21
Glen Burnie, MD
reply to patcat88
said by patcat88:

Boards don't think. They show up reluctantly once or twice a year for a few hours since they are paid little if anything. They never read in deep, or have someone from the corp explain to them the proposals by phone the day before to get rubberstamped the next day. All the members have day jobs at other fortune 500s or in govt. Boards only exist to recruit investors and job placement obligations for their college frat/secret society buddies.
Actually, they do think...about each other.

The members of the boards often sit on multiple ones and many members are CEOs of their own companies. So while one guys gets his "compensation" approved at one meeting, he approves the compensation of another fellow member at another meeting. Most look for short term payoffs instead of long term viability and that is why companies really need to start treating CEOs as owners; get paid when you do well.