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» AnimationNation   » General Discussion   » Judge in Disney case warns on soaring exec pay

   
Author Topic: Judge in Disney case warns on soaring exec pay
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IE # 13
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Of possible marginal interest:
Judge in Disney case warns on soaring exec pay

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Charles
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Frank, thanks for posting this. Talk about going to the very core of a key grievance that led to the creation of this site. Glad to see that someone, especially a judge in Delaware, is stepping up on this.

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Fooksie
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I don't like the idea of the federal government deciding how much I should be allowed to be paid.

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" Every move a picture! "
Buddy Love

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BobV
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I do, if you're in charge of a publicly traded corporation. Business leaders have shown time and time again that they are unable to police themselves when it comes to wage parity, employee rights and respect for the environment. We need government regulation to keep these bozos honest.
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knowledge
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public company with shareholders, then yes (only if need be). private company, no.
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knowledge
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to follow up, remember enron and the other scandalous crap of some of those big companies over the past couple of years. How many poor investors got screwed there?
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toonstruck
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While I don't think management should be making as much money as some are making (Disney being a prime example), I'm not so sure government should be sticking their nose in. If the board of directors think a CEO is worth a certain dollar cost, then maybe they are. If you don't, as a shareholder- you don't invest or try make changes via a vote.

If that doesn't work, as it surely won't in many companies (Disney), then maybe some regulation needs to be put in place. But not regulation for their compensation, but some other type of regulation for the people that decide that compenstation.

Where does the regulation end? Should they come back and say directors shouldn't be making 1/7th of a movie budget? Sure, directors are very important to the outcome of a film, but the CEO is very important to the outcome of an entire company. I just think the precedent that regulating compensation is dangerous and could trickle down to other peoples potential to get a salary they deserve.

I don't think regulation is necessarily bad, I just think regulating a salary is the wrong way to go about it.

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IE # 13
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quote:
If the board of directors think a CEO is worth a certain dollar cost, then maybe they are
In too many instances, boards of directors are cronies of the CEO, and some companies have a "weak" board which essentially answers to the CEO. This opens a business to mob-style looting from within. See Enron and etc.

Certain CEOs, such as Robert Miller of distressed GM-supplier/spinoff Delphi, have taken huge pay cuts (to $1 a year), I suppose to show "solidarity" with disadvantaged workers (although executive bonuses and benefits are never mentioned). An extreme contrast to that is the compensation of GM CEO G. R. Wagoner himself. Although GM is practically bankrupt, in 2004 Wagoner took home "$9,957,020 in total compensation including stock option grants from General Motors".

If you're interested in comparing executive pay to the performance of those executives' companies, here is a database:
http://www.aflcio.org/corporatewatch/paywatch/ceou/database.cfm

Eisner's pay is reported as:
In 2004, Michael D. Eisner raked in $8,312,373 in total compensation including stock option grants from Walt Disney Co..

And Michael D. Eisner has another $17,589,600 in unexercised stock options from previous years


How well has Disney been doing lately? I haven't checked. How much were Disney's assetts whittled down by the famous Eisner-caused lawsuit with whats-his-name?

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BobV
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quote:
Where does the regulation end?
Good question. The flip side to this is, how do you reign in an entrenched CEO with a board that is beholden to him, who is effectively immune to shareholder displeasure, and who pays himself hundreds of times the average employee wage?

Can anyone seriously object to an S.E.C. rule that limits CEO compensation to "only" one hundred times the compensation of the average employee?

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toonstruck
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I agree. The board members can pay the CEO way too much cause they are friends or for some other unjustified reason.

And I do think regulation is in order for some instances. I'm just not convinced that regulating compensation is it. I won't pretend to have answers, I just dont like the idea of the government telling people what they can't make.

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Christian
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quote:
I just dont like the idea of the government telling people what they can't make.
I don't think what's happening here is as simple as that.
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knowledge
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speaking of eisner, I wonder how much he's set to make when he finally sells all of his Disney stock?
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Mel Allen Sink
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So is this a tipping point? Or some flakey judges loopy opinion that's going to be thrown out and forgotten on the next appeal?

I'm annoyed at the current Republican regime for coddling corporate greed and excess. Also annoyed at the Democrats and labor for being to dumb to make hay in this environment.

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http://melallensink.blogspot.com

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