Tuesday, April 18, 2006

Over 100$ a minute!

Usually when you hear how much CEOs make, you feel like it's just beyond comprehension. Passed a certain number, it becomes meaningless, impossible to grasp, doesn't it? What is the difference between, say, $200 million and $300 million of income? What does it represent?
Last night, Brian Williams on NBC Nightlynews reported that Exxon chairman and chief executive Lee R. Raymond retired last December with a $400 million package. Well, that's another of those meaningless numbers to me.
But then, Williams mentioned the NYTimes estimate that Raymond made more than $686 million from 1993 to 2005, and this is where it becomes interesting - that number represents $144,573 for each day he spent leading Exxon.
That is $100.4 a minute - including sleep time!!

Granted the company's performance improved - Exxon's market value increased fourfold, overtaking BP as the largest oil company and General Electric as the largest American corporation... but $100.4 a minute! Even in the US, whose culture is more accepting of corporate money, it has caused outrage. According to the NYTimes some Exxon shareholders, academics, corporate governance experts and consumer groups were taken aback this week when they learned the details of Mr. Raymond's total compensation.
It is also interesting that it should be call a "compensation" (see what Lucian Bebchuk, from Harvard Law School has to say about that).
Well, in any case, such numbers cannot be viewed positively when consumers pay their gas almost $3 a gallon!

In the meantime, the French have also reported the news but have another way of putting it - Raymond's compensation represents 20,000 years of (French) minimum wage.

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