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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Raymond Duray who wrote (5487)	2/1/2002 12:53:41 PM
From: Sam	Read Replies (1) \| Respond to of 33421

Hi Ray, You (and John and Henry & others) will love this article on CEO compensation from the LATimes: latimes.com Nothing new, exactly, just the details that boggle the mind despite already being known in outline form. Sam An excerpt from the beginning of the article (though the details deeper down are the really slimey, grimey part): Despite Recession, Perks for Top Executives Grow Pay: Hidden benefits mushroom as employees' retirement plans shrink. By LIZ PULLIAM WESTON, Times Staff Writer The lavish retirement plans, low-interest loans and other perquisites showered on Enron Corp. managers have put a spotlight on a growing corporate trend--one of ever-richer executive benefits packages whose costs often can be hidden from shareholders. Compensation experts say companies are increasingly using executives' benefits packages, which already are far more generous than those offered to rank-and-file workers, as a way to quietly beef up total pay for top managers regardless of how their company performs. Sumptuous paychecks for executives are nothing new. But shareholder activists say weak regulatory requirements, along with a faltering stock market, are leading to unchecked growth in executive retirement plans and other benefits even as lower-ranking workers face losses and cutbacks in their own plans. "The trend has been [for executives] to be greedier and greedier, even though there's a recession," said Cynthia Richson, director of corporate governance for the State of Wisconsin Investment Board. "All this is designed to keep executives whole while the rank and file loses ground." As many workers' 401(k) retirement plans shrink, executives at some companies get guaranteed returns on their investments. Other companies pour hundreds of millions into special executive-only retirement accounts. Firms also pay for big insurance policies and offer executives multimillion-dollar loans, complete with below-market interest rates and a company promise to forgive some of the payments.... [more]