while stock price dropped 53%.
http://tdw.globeinvestor.com/servle...20080229/wnortel0229/stocks/news?back_url=yes
http://tdw.globeinvestor.com/servle...20080229/wnortel0229/stocks/news?back_url=yes
Nortel CEO gets 22 per cent pay raise in 2007
- Thread starter danmand
- Start date
Yep thats how it is, the super rich just keep getting richer every year, while 99% of us just try to stay where we are at 
I always find this a humorous topic. Do baseball players take salary cuts when their teams lose? Most executives have a large percentage of their comp tied to stock performance so their incentives are aligned with the shareholders.
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Not quite. most executives have a lot of OPTIONS to buy stocks, which does not quite align them with shareholders. In particular, options are far more volatile than the underlying stock so a small, short-term improvement in stock price benefits the executive much more than it benefits a typical shareholder.onthebottom said:
Arguably it would be better if most executives had actual stock, and stock that was escrowed against sale for a period of 5 years from the date they leave office. THAT might align them with the widows and orphans who own small numbers of shares.
I do agree with this sort of technique for alignment--in which light I disagree with the notion of paying cash bonuses for short-term performance.
fuji said:
This is worthy of debate, I'm sure you're aware that stock options are typically vested over 4 years so there is an inherent medium term to their value.
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CEO's are rare talents, like pitchers, that can have a disproportionate impact on results but can't do it themselves. A pitcher with a low ERA but without 20 wins may not have enough hitting behind him to let him reach that mark, a CEO may be years away from having the right product or GTM strategy to bring in short term results.DonQuixote said:
Both should be measured by performance but no single measure is enough to judge them. I've seen many cases of good CEOs with bad results and poor CEOs with good results.
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DonQuixote said:
While it's not a perfect metaphor I'd say the Board of Directors is the baseball manager.
Results have to be a measure, it's just not as simple as that.DonQuixote said:
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While it's not a perfect fit I do think it's relevant.DonQuixote said:
The board, like a baseball manager, rarely steps on the field and plays the game... a CEO is all about playing the game.
If you use short term measures (quarterly or annual returns) as the only measure of a long term strategic role then you're going to make bad decisions. That's really my only point.
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Let's remember that the CEO's salary is set by the board at the time he is hired....the board is taking a gamble and it looked like they lost.
However Nortel could be worse off maybe wihout him? I don't know. I just know that Nortel is in a very challenging enviroment.
However Nortel could be worse off maybe wihout him? I don't know. I just know that Nortel is in a very challenging enviroment.
Hmm. I was hoping to work the Abbott & Costello "Who's on first?" routine into the discussion. Just couldn't see how. Oh well...DonQuixote said:
jwm
This company should have there CEO’s paychecks garnished to pay back all they share holders starting from the smallest to the biggest share holders.
It is crazy how they lay off a few employees that only make around 50k a year while a do noting CEO gets a raise.
It is crazy how they lay off a few employees that only make around 50k a year while a do noting CEO gets a raise.
Really???? So why is it dynastic then? And why are all the people who make a run for the top jobs from elite families, rather than ordinary working people?DonQuixote said:
I had expected you to say that American capitalism was the more egalitarian of the two. I understand that quite a few people manage to make it to the top jobs from humble beginnings in the business world. In fact it seems to me that most of the people who start from humble origins and wind up with a top job in politics only got their opportunity by first advancing, by merit, to the elite level in the world of business.
Certainly elite family connections matter in both business and politics, but advancement based on merit rather than family seems much more common in business than in politics, at least as practiced in the United States (and in Canada too).
Sure, a lot of people/nations say one thing, and then do another.
When exactly did legal equal rights become synonymus with equal economic rights?DonQuixote said:
Don't people have the economic freedom to invest their money where they want, work where they want, save what they want and purchase what they want. The only economic freedom we don't have is how much of our hard work the government steals and wastes in taxes.
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The goverment steals from us by imposing unecessary taxes. While we never get to a point where we will be tax free, the question remains when is enough ...enough?DonQuixote said:
At what point will the goverment have enough money to run it's business...? I don't know about you but I have a budget at my house.
Like imposing a retirement system with poor returns where the funds are taken for pork barrel spending.....frasier said:
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