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Corporate CEOs are the Golden Ones of our economy. Each of them is paid a goldmine during their privileged tenure, and if they get the boot or if the company fails, they have multimillion-dollar golden parachutes to soften their fall. But what happens if they die at the corporate helm?
Not to worry, for they have taken care of Number One even in death by arranging ludicrously lavish payouts known as “golden coffins.” XTO Energy Inc., for example, is bound contractually to pay its CEO a “bonus” of $111 million if he croaks. Isn’t this dangerous, since it makes him worth more dead than alive to his heirs? Curiously, this deceased chief would also draw a $158,000 payment that XTO lists as a “car allowance.” Hey, where does this stiff think he’s going?
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More curious is a special benefit that the Shaw Group would pay to its top honcho. He is to get $17 million for agreeing not to join a competing firm after he dies. But even that is not the most preposterous posthumous payout. Nabors Industries is on the line to fork over a $263 million “severance” payment if its chieftain kicks the bucket. Death is, I suppose, the ultimate severance from a job, but a quarter-billion dollars is a pretty pricey send off – indeed, it’s more than the entire profit that the corporation made in the first quarter of this year.
It’s not like these guys have been scrimping along and need a little help to buy a burial plot. The CEO of Nabors, for instance, has hauled in $500 million in pay since he took the job. Come on, couldn’t he have bought a life insurance policy rather than soaking shareholders?
Corporate apologists say that such postmortem paydays are necessary as retainment incentives to keep CEOs from leaving. But who wants to retain a dead executive – and who wants a corporate leader so self-absorbed that he’d demand such a ripoff?
“Companies Promise CEOs Lavish Posthumous Paydays,” www.wsj.com, June 10, 2008