What to make of Dick Fuld's pay?

People often point out that compensation boards want top executives to rake in the bucks as long as shareholders do. But what about when the stock tanks? Should they be required to give back some of the stock gains they've pocketed? I really pose this as a rhetorical question, but it is striking to note, as a Fortune columnist does, that Dick Fuld, CEO of Lehman Brothers, has made $489.7 million (before taxes) from selling 14.4 million optioned and restricted shares over the years. For most of that time, investors were profiting as well. Last year, when Lehman stock dropped 16 percent, he still cashed in to the tune of $53 million. So what to make of it? Well, he was given the options and restricted shares legally. He had a right to cash out, but it looks bad. It's definitely a PR issue. The fact that Fuld will not receive his bonus is of little help. What would really help on that front now would be for the top execs to announce a massive purchase of Lehman stock with their own money. That would send the right message.  

For more:
- here's the column

Related Articles:
Top two execs at Lehman ousted; What about Fuld?
Lehman executives get nice windfall
Can Lehman Brothers be saved?

Post a comment