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Private Firms Lure C.E.O.’s With Top Pay

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Herman Munster Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jan-08-07 12:44 AM
Original message
Private Firms Lure C.E.O.’s With Top Pay
http://www.nytimes.com/2007/01/08/business/08private.ht...

Mark P. Frissora is an example of the risk being worth it. Up until last year, Mr. Frissora was the chairman and chief executive of Tenneco, the auto parts manufacturer. He was making only a few million dollars a year at Tenneco when executive recruiters approached him last year with several job offers. Among them was one to lead a big public company.

But then he was offered the chief executive’s job at Hertz, the rental car chain owned by a group of big private equity firms, including Carlyle Group, Clayton, Dubilier & Rice, and an investment arm of Merrill Lynch. The public company offers could not compete.

Mr. Frissora left Tenneco for Hertz in July and was granted a $4 million “make-whole” cash award and a guaranteed bonus of almost $1 million for 2006. He also was given millions in stock options and the chance to buy company stock — both at a very steeply discounted prices — and a special dividend that would put another $1.2 million in his pocket.

Less than six months and an initial public offering later, Mr. Frissora is more than $33 million richer on paper, according to an analysis by Brian Foley, an independent compensation consultant in White Plains. He stands to make even more money if Hertz’s share price goes up.

“It’s nice work if you can get it,” Mr. Foley said. And Mr. Frissora is not the only one to reap such riches.

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Occulus Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jan-08-07 12:50 AM
Response to Original message
1. I'd say we need a compensation cap for the position of CEO in any chartered corporation.
Since I don't see corporations as persons, I have no problem at all with this.
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The_Casual_Observer Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jan-08-07 01:08 AM
Response to Original message
2. Meaningless boobs being paid big money by meaningless boob
companies like Hertz. If Hertz vanished tomorrow would anybody care? I doubt that Mr. Frissora could balance his checkbook or change a tire on one of those rent-a-cars.
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Occulus Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jan-08-07 01:25 AM
Response to Reply #2
3. But the MONEY isn't meaningless
Edited on Mon Jan-08-07 01:29 AM by kgfnally
Lower CEO pay could translate into investment in the company or higher pay to workers or lower prices for consumers.

CEOs are, in general terms, utterly useless and completely unecessary. I have yet to hear a good argument for the very existence of the CXO.

That goes for CEOs, CFOs, COOs, etc. They're ALL useless. They don't DO work. Period. Their job is leisure, and I know, without a doubt, that I could sashay into ANY boardroom and, with the proper information in front of me, do the job of any CXO you care to name, in any company you care to name, without training, and (if someone read aforementioned corporate information to me) with my eyes closed.

There isn't a CEO 'decision' that I could not have come to with the same information, in the same amount of time. These people are paid obscenely exorbient amounts for doing exactly nothing at all, and it's time the public put a stop to it.

ed.: stupid errors; added a sashay.
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aquart Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jan-08-07 02:03 AM
Response to Reply #3
4. Tax their overpaid asses.
Tax them hard.
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provis99 Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jan-08-07 02:39 AM
Response to Reply #4
5. only taxing them would give them an aura of legitimacy
these guys are all crooks; they're in bed with the Board of Directors, who rotate between board service and becoming CEOs themselves. About what it would be like if the NFL general managers and coaches just swapped positions from time to time, excluding outsiders and giving themselves massive pay raises each time they switch.
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