WTF is going out with corporate America? CEO's and executives are taking big money, whether a company is doing well or not! They run the companies into the ground, use smoke and mirrors to make it seem like they're not getting any compensation, and laugh all the way to the bank. It's total bullshit! In the case of Bear Stearns, shareholders are likely to end up with about $2 dollars a share when not long ago it was comfortably above $100 a share and at one point, at about $160 a share.
But don't you worry for the "leaders" of this company, they'll still get megamillions as part of their compensation packages.
Here's an excerpt from the BusinessWeek article:
PLUMP BONUSES
At Bear, it was taken for granted that executives had a large stake in the company. Chief Executive Officer Alan Schwartz owns more than 1 million shares and employees own one-third of the shares outstanding. "They wanted people to have skin in the game," explained Chris Whalen of risk management consultant Institutional Risk Analytics and a former Bear employee.
But don't cry for Cayne and his cadre of Bear big shots. Their paper wealth may have disintegrated but for years leading up to Bear's collapse they had been the beneficiaries of one of the most generous compensation packages in the industry. Over five years, from 2002 through 2006, Cayne took home total compensation—salary, bonus, restricted stock, and stock options—worth a combined $156 million. Current CEO Schwartz made $141 million. Former Co-President Warren Spector, deposed after the hedge fund debacle, did the best of them all, reaping $168 million.
The biggest chunk of pay came in the form of bonuses, which for Bear execs were relatively easily obtained. Through 2005, bonuses were based on the completion of any one of nine metrics, a tactic that virtually guaranteed that targets would be met, according to a report from independent research firm the Corporate Library.
From 2002 through 2005, Bear Stearns proxy statements show that Cayne and his lieutenants, Schwartz and Spector, took home bonuses of between $9 million and $12 million each.
At Bear, it was taken for granted that executives had a large stake in the company. Chief Executive Officer Alan Schwartz owns more than 1 million shares and employees own one-third of the shares outstanding. "They wanted people to have skin in the game," explained Chris Whalen of risk management consultant Institutional Risk Analytics and a former Bear employee.
But don't cry for Cayne and his cadre of Bear big shots. Their paper wealth may have disintegrated but for years leading up to Bear's collapse they had been the beneficiaries of one of the most generous compensation packages in the industry. Over five years, from 2002 through 2006, Cayne took home total compensation—salary, bonus, restricted stock, and stock options—worth a combined $156 million. Current CEO Schwartz made $141 million. Former Co-President Warren Spector, deposed after the hedge fund debacle, did the best of them all, reaping $168 million.
The biggest chunk of pay came in the form of bonuses, which for Bear execs were relatively easily obtained. Through 2005, bonuses were based on the completion of any one of nine metrics, a tactic that virtually guaranteed that targets would be met, according to a report from independent research firm the Corporate Library.
From 2002 through 2005, Bear Stearns proxy statements show that Cayne and his lieutenants, Schwartz and Spector, took home bonuses of between $9 million and $12 million each.
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