Sunday, January 27, 2008

Change is Possible

Change is Possible
Fred Whittlesey
Compensation Venture Group, Inc.

Just a quick update. I've included the links so that you can view the original story.

13 January 2008
Los Angeles Times
For CEOs, Failure Can Be Lucrative

"This is another clear example of pay for failure," said Fred Whittlesey, principal consultant with Compensation Venture Group in Seattle. "How many more examples of this will we have to see before this gets fixed?"

"Every year, there's more talk about boards getting tough," said Whittlesey, who is a Countrywide shareholder. "But every year, they keep saying yes to these contracts."

14 days later...

27 January 2008
Countrywide CEO Mozilo Will Give Up $37.5 Million in Severance Benefits

"Countrywide Financial Corp. CEO Angelo Mozilo, under fire over the size of his potential payout from the proposed sale of his troubled mortgage company, says he is forfeiting some $37.5 million in severance pay, fees and perks he was scheduled to receive upon his retirement. 'I believe this decision is the right thing to do as Countrywide works toward the successful completion of the merger with Bank of America,' Mozilo said in the prepared statement."

And then there's this one...

23 January 2008
Seattle Times
Wamu Leaders to Profit Even if Stock Stays Low

"That rationale was condemned as "outrageous" by Fred Whittlesey of Compensation Venture Group, a Seattle-based executive-compensation consulting firm. All shareholders should hit the roof when they see what they've done here," said Whittlesey, himself a WaMu stockholder. They've created another layer of poor compensation policy on top of the existing poor compensation policy. Rather than setting the options' strike price at Tuesday's closing price of $14.77, Whittlesey said, WaMu's board should have set it at $40 — the stock's approximate price before last year's swoon. One of the things you don't do with stock options is give them to people who drove the shares down so they can profit by bringing them back up," he said.

Let's watch the headlines.