Even though stock prices have plummeted and staff cuts are prevalent, the 10 best paid CEOs still took home millions in compensation in 2008, predominantly in stock options and grants, according to an analysis by CNNMoney.com. The top earner was Sanjay Jha, CEO of Motorola (MOT), who took home a total pay package of $104.5 million; the lowest of the top 10, who got "just" $25.6 million, was A.G. Lafley, CEO of Procter & Gamble (PG).
But the two who might inspire the greatest shock and maybe anger, given how many billions of dollars their companies took in bailout funds, are Kenneth Chenault, CEO of American Express (AXP), whose total compensation was $42.8 million, and Vikram Pandit, CEO of Citigroup (C), whose total compensation was $38.2 million. Congress needs to act quickly to be sure they don't see compensation near these levels again until they pay back the government bailout funds.
I don't know what the boards of any of these companies were thinking when they voted for these pay packages. None of these companies had outstanding years in 2008. Wonder what they'll think these CEOs should get paid if their companies have a better year in 2009 or 2010?
Others in the top 10 include:
- Larry Ellison, CEO and founder of Oracle (ORCL), whose total compensation package was $84.6 million, mostly in stock options. He's amassed $26.6 billion shares of Oracle since he started the company. While he made sure he got his cut of Oracle profits over the years, shareholders just started getting their share in dividends in 2009.
- Mark Hurd, CEO of Hewlett-Packard (HPQ), whose total compensation package was $34 million.
- Jack Fusco, CEO of Calpine (CPN), whose total compensation package was $31.1 million.
- Rupert Murdoch, CEO of News Corp. (NWS), whose total compensation package was $30.1 million.
- David Cote, CEO of Honeywell International (HON), whose total compensation package was $28.7 million.
- Robert Iger, CEO of Walt Disney Co. (DIS), whose total compensation package was $28.4 million.
Do you think any of these CEOs truly earned these pay packages given the drop in stock price and company value in 2008?
Lita Epstein had written more than 25 books, including Trading for Dummies and Reading Financial Reports for Dummies.