The recent news about the eleventh hour award of nearly $4 billion in bonuses to Merrill Lynch employees is only the latest in a series of events exciting enthusiasm for "clawbacks" of allegedly excessive or undeserved Wall Street bonuses. Reports that New York City financial firms disbursed $18.4 billion in cash bonuses is 2008 added
A Quick Look at the Bailout Bill
Congress, regulators and leading figures in the Bush administration worked overtime this weekend and have crafted a compromise bill that apparently will be put to a congressional vote this upcoming week. A copy of the current discussion draft (which House Speaker Nancy Pelosi says will be “frozen” in this form) that likely will be put
Restatements, Clawbacks and CFO Career Consequences
If the facts don’t fit, you must remit. That seems to be the view of an increasing number of companies, as they have adopted provisions requiring repayment of executive compensation found to have been based on incorrect financial statements.
The concept of compensation clawbacks was actually built into the Sarbanes Oxley Act. Section 304 requires
The CEO’s “Pay Slice”, Corporate Governance, and Corporate Performance
One of the legacies from the era of the corporate scandals is the lasting image of certain corporate leaders as “imperial CEOs” (refer here) – that is, as greedy, power hungry overlords who exploited their companies to their own enrichment and to the shareholders’ detriment. Excessive CEO pay remains a widely perceived marker for poor
Check the CFO’s Pay Packet, Too
Commentators have long focused on CEO compensation as a leading corporate governance concern. Indeed, the Corporate Library has even suggested (here) that CEO compensation practices that “are poorly-aligned with shareholder interests” are “a powerful indicator of potential securities litigation.” While CEO compensation unquestionably is an important issue, academic research recently published by three
Executive Pay: Grasso Wins a Round over Spitzer’s Ghost
In a partial but significant victory in the New York Supreme Court Appellate Division, former NYSE Chairman Richard Grasso may have accomplished just enough to be able to keep his infamous NYSE pay package. In April 2004, Eliot Spitzer, then New York’s Attorney General, sued Grasso to compel him to return the bulk
Houses of Glory, Mansions of Shame: CEOs’ Homes and Corporate Performance
It is now a well-established part of the mythology of American capitalism that Warren Buffett still lives in the same modest brick colonial in Omaha, pictured above, that he bought in 1958 for $31,000. (According to Forbes magazine’s annual survey of billionaires’ houses, here, Buffett’s home had a 2003 tax valuation of $700,000.) Intuitively,
Executive Compensation, Legal Fees, and the Grasso Case
Eliot Spitzer sued former NYSE Chairman and CEO Richard Grasso to compel him to return the bulk of his nearly $190 deferred compensation and pension package, alleging that the pay package was “objectively unreasonable” under New York law governing nonprofit institutions and that Grasso had improperly influenced or misled the NYSE’s board directors to obtain
Executive Pay, Shareholder Activism, and Board Duties
There is no particular reason why I should bestir myself to defend ousted Home Depot CEO Robert Nardelli: He certainly bagged sufficient swag to soften the blows of even his most outraged attacker. Yet I think it is important to incorporate into the modern morality play that his departure has become a fair recognition