Excessive CEO Pay and Job Losses: Are They Linked?
By Carl M. Cannon
Real Clear Politics
Three weeks before Christmas in 2008, Philippe Dauman and Thomas E. Dooley, two top executives at Viacom Inc., wrote a “Dear Colleagues” letter to the employees of the media conglomerate informing them that the company was downsizing its workforce by 7 percent.
That represented 850 jobs, 850 human beings, who would be looking for work in the midst of the worst job market in 25 years. The layoffs were not performance based. Indeed, the men who wrote that Dec. 4, 2008, memo -- “Phil” and “Tom” is how they signed their names -- insisted that the departing employees should be proud of their contributions to the company that no longer needed them.
In an accompanying press release, Viacom also said that it hoped that the staff reductions, coupled with pay freezes for senior executives, would save some $200 million in 2009. It happened that way, too: That year’s financials showed the company’s revenues were nearly as high as in 2008, but with less overhead.
Apparently pleased with their own cost-cutting efforts, Dooley, Dauman (pictured), and Viacom Chairman Sumner Redstone paid themselves $165 million in salary, bonuses and stock options for the first nine months of the 2010 fiscal year. That figure is not a typo. Nor is it an isolated example.
(More here.)
Real Clear Politics
Three weeks before Christmas in 2008, Philippe Dauman and Thomas E. Dooley, two top executives at Viacom Inc., wrote a “Dear Colleagues” letter to the employees of the media conglomerate informing them that the company was downsizing its workforce by 7 percent.
That represented 850 jobs, 850 human beings, who would be looking for work in the midst of the worst job market in 25 years. The layoffs were not performance based. Indeed, the men who wrote that Dec. 4, 2008, memo -- “Phil” and “Tom” is how they signed their names -- insisted that the departing employees should be proud of their contributions to the company that no longer needed them.
In an accompanying press release, Viacom also said that it hoped that the staff reductions, coupled with pay freezes for senior executives, would save some $200 million in 2009. It happened that way, too: That year’s financials showed the company’s revenues were nearly as high as in 2008, but with less overhead.
Apparently pleased with their own cost-cutting efforts, Dooley, Dauman (pictured), and Viacom Chairman Sumner Redstone paid themselves $165 million in salary, bonuses and stock options for the first nine months of the 2010 fiscal year. That figure is not a typo. Nor is it an isolated example.
(More here.)
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