Democracy Gone Astray

Democracy, being a human construct, needs to be thought of as directionality rather than an object. As such, to understand it requires not so much a description of existing structures and/or other related phenomena but a declaration of intentionality.
This blog aims at creating labeled lists of published infringements of such intentionality, of points in time where democracy strays from its intended directionality. In addition to outright infringements, this blog also collects important contemporary information and/or discussions that impact our socio-political landscape.

All the posts here were published in the electronic media – main-stream as well as fringe, and maintain links to the original texts.

[NOTE: Due to changes I haven't caught on time in the blogging software, all of the 'Original Article' links were nullified between September 11, 2012 and December 11, 2012. My apologies.]

Wednesday, June 26, 2013

U.S. CEO sets a record with $159 million pension

McKesson’s Chairman and CEO John Hammergren has set a new record in corporate America: Largest pension around.

The drug distribution company disclosed in a regulatory filing Friday that Hammergren was entitled to a $159 million (U.S.) lump-sum payment for his pension, had he voluntarily left the company on March 31. The size of his pension was first reported by the Wall Street Journal on Tuesday.

Several compensation consultants say it is by far the largest pension for a current executive of a public company.

GMI Ratings, which tracks executive pay, said the 54-year-old’s pension is more than double that of the next largest, $74 million for Rupert Murdoch, chairman and CEO of News Corp.

Chris McGoldrick, a senior analyst for Equilar, also said it is by far the largest pension on record. Equilar provides data on executive compensation.

According to GMI, 54 per cent of CEOs of companies in the Standard & Poor’s 500 index have accumulated pension benefits. The average value of their pensions is just over $7 million, down from $11.5 million a year ago.

GMI researcher Greg Ruel said the drop is due to several CEOs with large pensions retiring, not corporate restraint.

Pensions used to be a common retirement benefit. Many companies have eliminated them and moved to defined contribution plans, such as 401(k)s, to control costs. But some still have special pension plans for executives.

McKesson spokesman Kris Fortner said in an email to the Associated Press that Hammergren’s pension was shaped by an employment agreement put in place more than 14 years ago and modeled on his predecessor’s contract, as well as outstanding company performance.

When Hammergren took over in 1999, the company was in turmoil following an accounting scandal that hurt its reputation and stock price. Since then, annual revenues have increased from $30 billion to $122 billion (U.S.), while the company’s market capitalization has more than tripled, to $25 billion.

Companies are required to estimate the current value of executive pensions and disclose what executives would receive under various termination scenarios.

Original Article
Source: thestar.com
Author: AP

No comments:

Post a Comment