Image by Renegade98 via Flickr
Here is the details for the executive compensation for the CEO of GM Rick Wagoner
General Motors Corp. Chairman and CEO Rick Wagoner's compensation package for last year is valued at $15.7 million.Google paid $1 in salaries and no bonus and no stock grants
That's 64 percent more than 2006 when the package was worth $9.57 million.
GM spokeswoman Julie Gibson says much of the increase is stock incentive awards that are based on future performance.
Wagoner earned $1.56 million in salary and no bonus last year, but he received $1.8 million in incentive awards and stock options valued at $11.7 million.
GM lost a record $38.7 billion in 2007, largely due to a charge for unused tax credits. Without the charges and other one-time items, the company lost $23 million. Source
Wall Street executives feeling harassed by taxpayers outraged at their pay might take note of how Google's ruling triumvirate fared in 2008: $1 in salary each, no bonus, no stock grants, and no stock options.
Google has offered co-founders Larry Page and Sergey Brin and Chief Executive Eric Schmidt "market-competitive" salaries every year since 2005, but once again in 2008, the three turned it down, according to a company regulatory filing Tuesday. "Due to their own preferences not to receive salary compensation, Eric, Larry, and Sergey each rejected these offers and continue to receive base salaries of $1," the company said.Source
Also, Japan Airline CEO takes a voluntary cut to his salary to save money for the company and keep people employed.
Looking at this, is it safe to draw the conclusion that there is no correlation between executive compensations and the performance of the company?
The moral of the story is that look for companies that are not paying excessive compensation to its CEOs for future investment. Probably a good idea in choosing stocks for building an investment portfolio.
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