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banyon
04-18-2006, 12:11 AM
Ex-Exxon CEO's Massive Pension Draws Fire


http://media3.washingtonpost.com/wp-dyn/content/photo/2006/04/16/PH2006041600099.jpg
By STEVE QUINN
The Associated Press
Sunday, April 16, 2006; 9:20 AM

DALLAS -- A $69.7 million compensation package and $98 million pension payout to Exxon Mobil Corp.'s former chief executive and chairman Lee R. Raymond has some shareholders and economists asking, "how much is enough?"

"Some folks will ask the question, 'Is this more evidence of big oil taking an enormous windfall and retaining all the riches?'" said Mel Fugate, assistant professor for Southern Methodist University's Cox School of Business.

Exxon Mobil Corp. Chairman and CEO Lee Raymond is shown in this May 2005 file photo. Under Mr. Raymond, the company's market value increased fourfold to $375 billion, overtaking BP as the largest oil company and General Electric as the largest American corporation. For his efforts, Raymond, who retired in December, was compensated more than $686 million from 1993 to 2005, according to an analysis done for The New York Times by Brian Foley, an independent compensation consultant. That is $144,573 for each day he spent leading Exxon's "God pod," as the executive suite at the company's headquarters in Irving, Tex., is known. (AP Photo/Donna McWilliam) (Donna Mcwilliam - AP)

The Irving company has drawn criticism from politicians and economists for becoming the most profitable company in history _ at consumers' expense, they say.

Exxon benefited from high oil and natural gas prices and solid demand for refined products en route to earning $36 billion last year. The company has defended its profits, saying that other industries have larger profit margins but oil companies' bottom lines stand out because they operate on a much larger scale.

Recent news of Raymond's payout and pension is stoking embers Fugate said had been starting to die out. But with gasoline prices again reaching $3 a gallon at the pump in some areas and big oil companies about to report first-quarter earnings in coming weeks, expect more fallout, economists say.

On Wednesday, Exxon reported executive compensation in a regulatory filing that showed Raymond receiving $48.5 million in salary, bonuses, incentive payments and stock awards.

His compensation package also included $21.2 million from exercising stock options, which the company stopped awarding in 2001.

His $98 million pension payout reflects 43 years of service. But he would have received nearly $17 million less had he retired just last year, according to the company's 2005 proxy statement.

In this year's proxy statement, Exxon defended the package by saying it rewards Raymond's "outstanding leadership of the business, continued strengthening of our worldwide competitive position, and continuing progress toward achieving long-range strategic goals." Raymond had been CEO since 1993 before stepping down at the end of last year.

Exxon added that Raymond's compensation is "appropriately positioned relative to CEOs of U.S.-based, integrated oil companies and other major U.S.-based corporations, particluarly in view of the long-term performance of the company and the substantial experience and expertise that Mr. Raymond has brought to the job."

Last year, Chevron Corp. Chairman and CEO David O'Reilly received a $1.55 million salary, $3.5 million bonus and $3.57 million in long-term compensation. He did not exercise any options, but owns options valued at just over $34 million, including exercisable options worth $28 million, according to Chevron's proxy.

Fugate, who specializes in executive compensation and management, said Exxon is sending a "very, very bad signal" by allowing Raymond to select the lump-sum payout.

"They are in very, very rich times, so on one hand they say, 'we can afford it,' but on the other hand they are taking an awful lot of heat because they've made too much at the expense of consumers. I'm surprised they are not being asked to justify that."

They will be at the company's shareholders meeting in Dallas on May 31. Several shareholders have placed resolutions on the agenda that, if passed, would put the clamps on some executive pay.

Shareholder Emil Rossi, author of one of the resolutions, says that although he's done well as a longtime owner of Exxon stock, he believes the executives are keeping too much for themselves.

"(Raymond) took over a good company," said Rossi, of Boonville, Calif. "He didn't bring it out from being a bad company, so his pay is clean out of reason. It's not because of his smartness."

Twice since November, big oil executives, including Raymond before his retirement, sat in Senate hearings defending their profits and deflecting accusations of gouging.

banyon
04-18-2006, 12:12 AM
Jowl-f***er

'Hamas' Jenkins
04-18-2006, 12:26 AM
It looks like he has a football-sized goiter on his throat. :Lin:

Dave Lane
04-18-2006, 12:54 AM
He's melting...

Dave

Braincase
04-18-2006, 06:29 AM
It looks like he has a football-sized goiter on his throat. :Lin:

That's where the oil reserves are stashed.

Kraut
04-18-2006, 06:45 AM
Guy looks like a f***ing tard....

Amnorix
04-18-2006, 07:03 AM
I have no problem with executives of big companies being rich. REALLY rich.

But then there's beyond ludicrous, and this looks to be right in that ballpark.

Cochise
04-18-2006, 07:31 AM
I have no problem with executives of big companies being rich. REALLY rich.

But then there's beyond ludicrous, and this looks to be right in that ballpark.

Yeah, perhaps this is beyond the level of any kind of taste.

But on the other hand, he had 40 years of service, and he did quadruple the value of the company during his tenure (I think they said that on the news...). You can't say that he didn't excel in his work. So like you I agree that he should be filthy, stinking rich for being a CEO who increased shareholder wealth so much. This amount however seems like a pretty bad PR move if nothing else.

Amnorix
04-18-2006, 08:12 AM
Yeah, perhaps this is beyond the level of any kind of taste.

But on the other hand, he had 40 years of service, and he did quadruple the value of the company during his tenure (I think they said that on the news...). You can't say that he didn't excel in his work. So like you I agree that he should be filthy, stinking rich for being a CEO who increased shareholder wealth so much. This amount however seems like a pretty bad PR move if nothing else.


I agree that it appears he did a fine job, although Joe the Chimp could've increased the value of an oil company these days. Still, let's give him the benefit of the doubt and say that he was truly a superb CEO.

Let's note first that "Raymond, who retired in December, was compensated more than $686 million from 1993 to 2005, according to an analysis done for The New York Times by Brian Foley, an independent compensation consultant. That is $144,573 for each day" he spent as CEO.

Presumably those numbers are "all-in" -- i.e. they include options, SARs, deferred comp and whatever other kind of comp lawyers and accountants are coming up with these days.

Now he gets a huge parachute on the way out the door?!

It looks bad because it IS bad.

Garcia Bronco
04-18-2006, 08:47 AM
All that money...somebody get the man a dentist.

patteeu
04-18-2006, 09:47 AM
The guy piloted his company to the top of the fortune 500 and into record breaking profit territory. He deserves record breaking compensation. I have absolutely no problem with this. The shareholders should elect different directors if they don't like how the company is being run or how the management is being compensated. All the other critics should resist the temptation to indulge their envy and their hate.

PR-wise, it will be used against him and Exxon, but that's the only negative.

banyon
04-18-2006, 09:51 AM
The guy piloted his company to the top of the fortune 500 and into record breaking profit territory. He deserves record breaking compensation. I have absolutely no problem with this. The shareholders should elect different directors if they don't like how the company is being run or how the management is being compensated. All the other critics should resist the temptation to indulge their envy and their hate.

PR-wise, it will be used against him and Exxon, but that's the only negative.

If Cocaine were legal, then this description would have fit Pablo Escobar too.

jspchief
04-18-2006, 09:56 AM
I have no problem with executives of big companies being rich. REALLY rich.

But then there's beyond ludicrous, and this looks to be right in that ballpark.On the heels of what the country is facing in gas prices, the arrogance of this severance package is astounding.

I'm all for capitalism and free trade. But these guys are clearly oblivious to the state of mind of the American consumer right now. Everybody already feels like these companies are f*cking us. A few more moves like this, and the government won't have a choice but to step in.

patteeu
04-18-2006, 10:06 AM
If Cocaine were legal, then this description would have fit Pablo Escobar too.

I'm not sure his operation would have topped the fortune 500, but your comparison is close enough for internet message board work.

Amnorix
04-18-2006, 10:11 AM
The guy piloted his company to the top of the fortune 500 and into record breaking profit territory. He deserves record breaking compensation. I have absolutely no problem with this. The shareholders should elect different directors if they don't like how the company is being run or how the management is being compensated. All the other critics should resist the temptation to indulge their envy and their hate.

PR-wise, it will be used against him and Exxon, but that's the only negative.

Exxon in 1993 was probably, what, #3 on the Fortune 500? Let's not suggest that he's Michael Dell or Bill Gates or anything...

You overstate the power of shareholders in huge public corporations. Although the power has started to shift, due to large institutional shareholders such as mutual funds and the like, it's not like the vast majority of Exxon shareholders can easily send a message to the directors that the CEO is overpaid.

I have no envy or hate. I don't know the guy from Adam, and whether he makes $10 million or $10 billion doesn't make a helluva lot of difference to me. Whatever Exxon shares I may have are nominal in number, held through mutual funds.

There is a principle here, and it isn't based on jealousy.

Kraut
04-18-2006, 10:11 AM
On the heels of what the country is facing in gas prices, the arrogance of this severance package is astounding.

I'm all for capitalism and free trade. But these guys are clearly oblivious to the state of mind of the American consumer right now. Everybody already feels like these companies are f*cking us. A few more moves like this, and the government won't have a choice but to step in.
Amen !! But will the American people even take notice to these kind of stories and get angry? I doubt it. :shake:

patteeu
04-18-2006, 10:27 AM
Exxon in 1993 was probably, what, #3 on the Fortune 500? Let's not suggest that he's Michael Dell or Bill Gates or anything...

You overstate the power of shareholders in huge public corporations. Although the power has started to shift, due to large institutional shareholders such as mutual funds and the like, it's not like the vast majority of Exxon shareholders can easily send a message to the directors that the CEO is overpaid.

Gates and Dell haven't made it to the top spot yet. True enough that this guy didn't start from scratch, but I'm not sure why that should be held against him or why that should tarnish his undeniable success. (And BTW, both Gates and Dell have made more money for the remarkable jobs they've done than this guy has anyway).

Exxon shareholders have just as much control over Exxon management as American voters have over our government. If the number of shareholders who are upset about this are a tiny minority, then who cares if their message doesn't result in change? If the number of shareholders who are upset with current management is a majority, then management will be changed. I don't think I'm overstating anything here.

I have no envy or hate. I don't know the guy from Adam, and whether he makes $10 million or $10 billion doesn't make a helluva lot of difference to me. Whatever Exxon shares I may have are nominal in number, held through mutual funds.

There is a principle here, and it isn't based on jealousy.

What is the principle and how does that principle translate into an acceptable dollar amount?

IMO, the principle is that the shareholders should elect the directors that they want to run their company and the directors should hire a CEO and determine his compensation. That seems to be what happened here.

jspchief
04-18-2006, 10:27 AM
But will the American people even take notice to these kind of stories and get angry? I doubt it. If there's anything you can bank on, it's the ignorance and apathy of today's American. Exxon knows this story will be tucked away in the DC forums of the world.

Brock
04-18-2006, 04:07 PM
He probably came up with the plan that has the consumer in the position they're in today. In that case, he's worth every penny.

Duck Dog
04-18-2006, 04:28 PM
I have no problem with executives of big companies being rich. REALLY rich.

But then there's beyond ludicrous, and this looks to be right in that ballpark.


That's what I'm thinking too, this kind of money is insane.

Cave Johnson
04-18-2006, 05:45 PM
I'm desensitized to riduculously outsized executive pay. What's the ratio now, like 350 or 400:1 compared to the average worker? Moreover, I wonder what Jabba the CEO did to worker pensions and health care benefits during his tenure?

BigMeatballDave
04-19-2006, 12:26 PM
$167M?! Jesus H. Christ! $10 million is fair...

patteeu
04-19-2006, 12:51 PM
$167M?! Jesus H. Christ! $10 million is fair...

I think $2.25 per hour is fair for you. How much sense does that make?

WilliamTheIrish
04-19-2006, 08:39 PM
Big oil has a face now. eek

Cave Johnson
04-19-2006, 08:51 PM
In addition to having limey-esque dental hygene, apparently Lee Raymond has a poorly developed sense of irony.

"In some of the countries where we operate, there is a tradition of corruption, in which the political elites work with business in the framework of unsavory relationships."

"We have seen that in this country in the last few years, particularly on Wall Street, with the rise of the old human frailty of greed. This occurs when people begin to serve only their own needs to the detriment of everyone else."

http://www.brainyquote.com/quotes/authors/l/lee_r_raymond.html

Cave Johnson
04-19-2006, 08:54 PM
Dude was also delivering returns for ExxonMobil that were barely above the industry average.

http://www.forbes.com/finance/lists/12/2003/LIR.jhtml?passListId=12&passYear=2003&passListType=Person&uniqueId=UZ74&datatype=Person

Chiefs Express
04-19-2006, 08:58 PM
I'm waiting to find out how this will be tied to the Bush Administration.

As far as his teeth and football sized growth on his neck; I don't think he really gives a crap....after all he just got $167,900,000.00 of our money. With money like that he will have all of the young hot chicks after his nasty ass.

WilliamTheIrish
04-19-2006, 08:59 PM
Dude was also delivering returns for ExxonMobil that were barely above the industry average.

http://www.forbes.com/finance/lists/12/2003/LIR.jhtml?passListId=12&passYear=2003&passListType=Person&uniqueId=UZ74&datatype=Person

Taking a tangential view: What were Ex/Mobile profits and what did the corporation pay in taxes?

banyon
04-19-2006, 09:30 PM
I think $2.25 per hour is fair for you. How much sense does that make?

So long as we're dealing in counterfactuals, would it be fair if Lee R. Raymond made $1.7 trillion and every other American (you included) made around $200 a year if that's what the market dictated?

patteeu
04-20-2006, 01:35 AM
So long as we're dealing in counterfactuals, would it be fair if Lee R. Raymond made $1.7 trillion and every other American (you included) made around $200 a year if that's what the market dictated?

Yes. You knew I'd say that didn't you?