[ad_1]
First Republic Lost $100 Billion in Deposits in Banking Panic
[ad_2]
Tag: executive pay
-
Employees asked about their canceled bonuses. The CEO warned them against living in ‘Pity City.’
[ad_1]
The chief executive of the high-end office-furniture company MillerKnoll has gone viral. And probably not in a manner she would prefer.
In a leaked Zoom call of a MillerKnoll staff town hall last month, CEO Andi Owen addressed concerns from employees about the company’s decision to withhold bonuses. It quickly descended into her lambasting staff for complaining about the move.
“Questions came through about, ‘How can we stay motivated if we’re not going to get a bonus?‘ ” she says in the meeting recording. Owen — tapped in 2021 by Fast Company as one of the most creative people in business and celebrated that same year in the New York Times for her navigation of the coronavirus pandemic and swing-state sociopolitics — tells employees of the Zeeland, Mich., company to focus on things the company can control, such as customer service.
From the archives (April 2021): Herman Miller and Knoll to merge in $1.8 billion deal that will create design leader as companies reimagine office
“Don’t ask about: What are we going to do if we don’t get a bonus?” she says, growing animated, even, apparently, agitated. “Get the damn $26 million. Spend your time and your effort thinking about the $26 million we need and not thinking about what you’re going to do if you don’t get a bonus. All right? Can I get some commitment for that? I would appreciate that.”
Though she didn’t specifically identify the significance of the $26 million figure, the company’s operating expenses rose by exactly that amount in its third quarter due to “voluntary and involuntary reductions in the company’s workforce and charges for the impairment of assets associated with the decision to cease operating fully as a stand-alone brand.”
MillerKnoll’s third-quarterly filing showed that the furniture maker — the product of a 2021 merger of the Herman Miller and Knoll brands, behind products such as the Eames lounge chair and the Saarinen Tulip table, respectively — expects lower sales in the fourth quarter after posting a decline in orders and sales margins in the three months ending March 4.
Owen recalls in the video that a past employer told her, “You can visit Pity City, but you can’t live there.”
“So, people, leave Pity City,” she continues, exclaiming: “Let’s get it done.”
“You have to be a psychopath to say this stuff to your employees when you are taking a massive bonus. Does she think they won’t find out?” asked one Twitter user.
“Plenty going on here but one of many things that leapt out to me was that mere moments after she went with the ‘be kind to people’ bit, she was yelling at workers,” another said.
The company said that the widely shared video clip had been taken out of context.
“Andi fiercely believes in this team and all we can accomplish together, and will not be dissuaded by a 90-second clip taken out of context and posted on social media,” a spokesman said in a statement.
Owen made $5 million last year. The company has yet to say how much she will make this year. The company this year has expensed $15.7 million in stock-based compensation.
MillerKnoll shares
MLKN,
-2.38%
have dropped 12% in 2023, compared with the 8% gain for the benchmark S&P 500
SPX,
+0.02% .Other MillerKnoll brands include Design Within Reach, acquired by Herman Miller a decade ago and recognized as having made the iconic midcentury designs of Charles and Ray Eames, Isamu Noguchi, George Nelson, and others available to a wider, if affluent, audience without engaging an interior designer; the Danish design brand Hay; and Holly Hunt.
[ad_2]
-
Intel cuts pay, bonuses and other benefits while maintaining dividend
[ad_1]
Intel Corp. continues to cut costs for everything except payments to investors.
Intel
INTC,
+3.03% ,
which is already in the process of cutting what is believed to be thousands of jobs amid steep declines in profit and revenue, is reducing Chief Executive Pat Gelsinger’s base salary by 25% and trimming other salaries at a descending rate based on seniority, down to 5% cuts for midlevel positions, a person familiar with the matter told MarketWatch. While nonexempt workers and junior positions face no pay cuts, Intel is trimming its 401(k) contributions to 2.5% from 5% and will suspend merit raises and quarterly performance bonuses, the person said. Annual performance bonuses and stock grants will remain.In an emailed statement, an Intel spokesperson confirmed “several adjustments to our 2023 employee compensation and rewards programs.”
“As we continue to navigate macroeconomic headwinds and work to reduce costs across the company, we’ve made several adjustments to our 2023 employee compensation and rewards programs,” the statement said. “These changes are designed to impact our executive population more significantly and will help support the investments and overall workforce needed to accelerate our transformation and achieve our long-term strategy. We are grateful to our employees for their commitment to Intel and patience during this time as we know these changes are not easy.”
Opinion: Intel just had its worst year since the dot-com bust, and it won’t get better anytime soon
The move is similar to a 50% cut in stock compensation that Apple Inc.
AAPL,
+0.87%
CEO Tim Cook requested and received, though Apple is one of the few large Silicon Valley tech companies that has not announced layoffs yet. Intel is targeting $3 billion in cost cuts in 2023 that include hundreds of layoffs that have already been disclosed in California, with many more expected.Intel has not touched its dividend, though, even as its free cash flow fell into the red during 2022 and is expected to be negative again this year. The chip maker paid out roughly $1.5 billion in dividends in the fourth quarter, completing $6 billion in annual payments, and maintained the same level of payments for the first quarter despite analysts questioning whether the company can afford it.
For more: Intel stock’s dividend sticks out among chip makers
“The board [and] management, we take a very disciplined approach to the capital allocation strategy and we’re going to remain committed to being very prudent around how we allocate capital for the owners, and we are committed to maintaining a competitive dividend,” Chief Financial Officer David Zinsner said when asked directly about the dividend during Intel’s earnings call last week.
Intel shares have declined 42.1% in the past 12 months, as the S&P 500
SPX,
+1.30%
has dropped 10.3% and the Dow Jones Industrial Average
DJIA,
+0.36%
— which counts Intel as one of its 30 components — has fallen 3.7%.[ad_2]
-
CEO pay cuts could be just the start | CNN Business
[ad_1]
New York
CNN Business
—
Corporate boards are slashing the pay of some leading CEOs in a new trend that could just be getting started.
The pay cuts are hitting some of America’s best-known and highest-paid bosses, including Apple CEO Tim Cook, Morgan Stanley CEO James Gorman and Goldman Sachs CEO David Solomon.
The moves follow a dreadful year in the stock market – 2022 was the S&P 500’s worst year since 2008 – and come as a growing number of corporations lay off rank-and-file workers to brace for a potential recession.
For example, Goldman Sachs laid off 3,200 employees earlier this month amid a downturn in Wall Street dealmaking. The bank then disclosed on Friday that Solomon’s 2022 pay is being cut by nearly 30%. Goldman Sachs’ profit dropped 49% last year as the slowdown in dealmaking curbed advisory fees.
“This is a show of solidarity. CEOs need to share the pain,” said Nell Minow, vice chair of ValueEdge Advisors, which advises institutional investors on corporate governance matters.
A similar pay cut could be coming for Sundar Pichai, the CEO of Google parent Alphabet
(GOOGL).After Alphabet announced 12,000 job cuts this month, Pichai told employees that top executives would take a “very significant” pay cut, Business Insider reported. Google did not respond to a request for comment.
But don’t feel too badly for these top execs. They’re still raking in serious cash and stock awards, just not quite as much as in the past.
Apple, for example, said it is cutting the target pay package of Cook by 40%. But that still leaves him with a massive $49 million in total compensation.
“They are still overpaid. Let me super clear about that,” said Minow.
Among the 500 largest public companies by revenue, the median CEO made $14.2 million in fiscal 2021, up 18.9% from the year before, according to the latest research from Equilar.
Tech bosses have received the biggest pay hikes, with the median CEO pay surging by 42.1% in 2021 to $19.1 million, Equilar said.
Earlier this month, Morgan Stanley announced Gorman made $31.5 million in total compensation for 2022, down 10% from the year before. The Wall Street bank said its compensation committee took into consideration the fact that “in a challenging economic and market environment firm performance for 2022 was not as strong as the prior year” when it enjoyed record results.
Minow is relieved that some boards are imposing pain on CEOs.
“That’s exactly the way pay is supposed to work,” Minow said. “The problem with pay traditionally is it’s been all upside and no downside. CEOs would often get all the credit and money for good times and then blame El Nino or some extraneous force for the downside. Now they are being forced to accept more responsibility.”
Of course, some of that responsibility is coming because the rules have changed.
After the 2010 Dodd-Frank law, regulators have required public companies to give shareholders a voice on compensation issues. So-called “Say on Pay” votes are advisory, meaning companies can still go forward even if 100% of shareholders vote no. Still, having shareholders reject pay packages is an embarrassment companies try to avoid.
Last year, JPMorgan Chase suffered a blow when its shareholders voted down a massive $52.6 million retention bonus that was planned for CEO Jamie Dimon.
This month, JPMorgan announced Dimon’s pay will be unchanged at $34.5 million – even though wages are rising for average workers. The bank also said it decided not to give Dimon a special award for the year.
That means Dimon’s pay isn’t budging even as wages go up for many employees.
[ad_2]
-
Ousted Disney CEO Bob Chapek will get $20 million exit pay | CNN Business
[ad_1]
New York
CNN
—
Ousted Disney chief executive Bob Chapek is set to receive a hefty paycheck following his exit.
The Walt Disney Company said the former CEO, who took over in February 2020 after longtime CEO Bob Iger retired, is eligible to take home a severance pay package worth roughly $20 million, according to a regulatory filing Tuesday. That’s in addition to the $24 million he made last year — his $2.5 million base salary plus millions in stock options and awards. That’s down from the $32.5 million he made in 2021.
Chapek abruptly exited the company in November after a hectic two-year stint marked by Covid-19 shutdowns, a PR debacle related to Florida’s “Don’t Say Gay” bill and a significant slowdown in demand for streaming services. He was replaced by his predecessor, Iger.
The proxy filing said that the board determined that Chapek “was no longer the right person to serve in the CEO role,” even though it had voted to extend Chapek’s tenure for three years in June 2022.
“The significant developments and change in the broader macroeconomic environment over this period informed how the board viewed the appropriate leader in light of the rapidly evolving industry and market dynamics,” the filing said.
Disney shares, which were trading at about $170 in January 2022, have fallen to about $100 a share.
Iger has returned to Disney at a tumultuous time. Its streaming business lost $1.5 billion in the fourth quarter, and Disney’s media networks are struggling as cord-cutting accelerates and once-lucrative outlets like ESPN lose household reach.
Dan Loeb, the activist investor and Third Point CEO, made headlines in August when he suggested “a strong case can be made that the ESPN business should be spun off to shareholders with an appropriate debt load.”
A Wells Fargo analyst also called on Disney to ditch ESPN in December.
Disney
(DIS) previously revealed that Iger earned a $1 million base salary. However, that compensation comes with an annual bonus of up to $1 million, as well as an annual incentive-based award with a target value of $25 million. That means that Iger has the potential of pulling in around $27 million.Last week, Disney named Nike executive chairman Mark Parker as its new board chair, replacing longtime director Susan Arnold, whose term limit is expiring.
[ad_2]
