View Full Version : Aubrey McClendon named the best-compensated CEO for 2008

05-04-2009, 08:19 AM
Non-pay perks abound for some CEOs - (

By Del Jones and Barbara Hansen, USA TODAY

Aubrey McClendon of Chesapeake Energy (CHK) was the best-compensated CEO of 2008 at $112 million. Yet, in December, the Chesapeake board of directors approved an extra $12.2 million for the purchase of McClendon's collection of historical maps, books, paintings and photos, according to Chesapeake's proxy. The maps and artwork had adorned Chesapeake's headquarters, and the proxy notes that the company got a good deal.

OVERVIEW: CEO pay dives in a rough 2008
STOCK OPTIONS: A blunt instrument
SORTABLE LIST: CEOs' 2008 pay, bonuses, benefits

In these times of economic difficulty, CEO bonuses may have gone down, but companies continue to be creative when handing out perks. While the median value of bonuses and other incentive cash dropped 27% in 2008, an examination of CEO compensation by USA TODAY and the Associated Press found that the median value of perks and other compensation increased 7% to $170,501.

There are many examples of the usual CEO benefits, sometimes worth millions, such as chauffeurs, security and the personal use of corporate aircraft. Companies often don't stop at paying CEOs big bonuses, but step in with more money to pay the taxes on those bonuses, known as tax gross-ups.

FIND MORE STORIES IN: United States | New York | Phoenix | Google Inc | Chesapeake | Duke Energy | Capital One | Occidental Petroleum | Chesapeake Energy | Aubrey McClendon | AFL-CIO | Target Corporation | Johnson & Johnson | Richard Fairbank | Eric E. Schmidt
One perk involves a non-compete clause for a dead man, says Vineeta Anand, chief research analyst of the AFL-CIO Office of Investment, which produces the website Executive PayWatch.

Should James Bernhard, CEO of the Shaw Group die, the engineering and construction company would pay his family $18 million for him not to compete with the company for two years, Anand says. "It's not only funny, it's outrageous," she says. "That is the most outrageous perk of all. Everything pales by comparison."

Shaw spokesman Gentry Brann says it is really an award that Bernhard is to be paid upon his departure from the company. If he dies, his family would get it. "To conclude that we require him not to compete for two years after his death to receive payment is a gross mischaracterization of his agreement," Brann says.

A sampling of other CEO perks and other compensation:

• Three CEOs got all their compensation this way: James Rogers of Duke Energy (DUK), at $524,589; Eric Schmidt of Google(GOOG), at $508,763; and Richard Fairbank of Capital One Financial (COF), at $68,344. Schmidt (who did receive $1 in salary) got about $403,000 worth of personal security and more than $100,000 in personal use of the company jet, the AP says. Fairbank received a car allowance, insurance, health care and home security.

• Occidental Petroleum (OXY) paid CEO Ray Irani more than $400,000 for tax preparation and financial planning services.

• Robert Ulrich retired as CEO of Target (TGT) last year. But he is founder and chairman of the Musical Instrument Museum that will open in 2010 in Phoenix. Target chipped in with the free services of its employees and office space to help in the design of the museum. The company estimates the office space donation at $120,000, but includes no estimate on the value of the time Target employees have spent on the project.

• FTI Consulting (FCN) advises companies on bankruptcy and restructuring issues. In a footnote, the company says that it has paid a $1.1 million deposit in December for a country club membership for executives including CEO Jack Dunn.

• Johnson & Johnson (JNJ) CEO William Weldon got $154,000 in personal flights on the company jet and $26,000 for a car and driver. As part of his long-term cash compensation he also got a $3.6 million payment to a retirement plan.

Paul Hodgson, senior research associate for the Corporate Library governance research firm, says a few companies have boosted CEOs' salaries so they can pay for perks themselves. Provident New York Bancorp, for example, gave CEO George Strayton a 3.2% raise expressly to cover the discontinuance of his company vehicle and country club membership.

Hodgson says the Corporate Library is researching tax-gross ups now. The data is not ready to be released, he says, but "despite all the bad press," companies continue to pay CEOs extra money to cover their taxes.

05-04-2009, 04:13 PM
It looks like that 'highest compensated CEO' title is also getting him into to some hot water with shareholders. Chesapeake sure seems to have some dodgy practices.

05-13-2009, 09:56 PM
you can't get that big without getting dirty somehow.
and some of their leasing land deals back east seems at be"
Time for the DOJ/AntiTrust division should investigate AM/ "& The Enron on Western"..