should I hand in my iPhone now or later? the compensation committee and the Labor Day rant



NOT WHAT IT USED TO BE
OK, counting pennies is not enough. I kind of knew that when banks stopped handing out coin wrappers, but recent events have hammered it home. I wonder if we aren't heading for, or haven't already become, a two-class society - the super-rich, and "other." Even recognizing that talent and drive should be "incentivized" and rewarded in a properly ordered society, reading about executive compensation makes me ill. Some years back, in response to a tax law change that essentially required executive compensation in traded corporations to be "fair and reasonable," the Compensation Committee was born. A corporation's Comp Committee decides what compensation should be. It's generally composed of members of the Board of Directors, can have a few outsiders (execs of other corps), and how does it carry out its mandate? Another industry came forth: the Compensation Consultants. For a substantial fee, they cover the rears of the Comp Committee, and they retain other experts to recommend stuff like option plans, life insurance plans, loans to execs, bonuses, and so on. Often the companies that sell these plans are related to the consultanging firm. Ask yourselves: would the Consultant make a recommendation that would be unpopular? Hah. So what is fair and reasonable is determined by the highly compensated themselves, who purchase elegant reports from those with a financial interest in preparing them.

AN INTERNET CAFE
DIRECTIONS TO ANOTHER INTERNET CAFE
I'm looking at my Macbook and my iPhone, and I truly love them. I love being in touch with family about to propagate, or land, or leave, love staying up-to-date on assignments and meetings... . Well, you know. And I confess to being just the teensiest bit awkward in internet caf├ęs and phone booths, especially when I can't figure out how to operate the equipment or how to pay.  My phone contract is about to end and the kids at the Apple stores have told me they think I should wait for a new contract and phone until, say, the end of September. I can take a hint. It's marked on my calendar, same color as the date Missoni comes to Target.

Meanwhile, I continue to rummage web sites for news, and what I find is distressing. Here, for instance, is a news analysis about the compensation of Tim Cook, the heir apparent to Steve Jobs: look for familiar names towards end of story. Hmm, I wonder who recommended the $52 million stock plan? OK, here's a cut-and-paste quote for those who are so transfixed they don't want to click:
STILL ANOTHER INTERNET CAFE
 Last year, Central Laborers Pension Fund, an Apple shareholder, tried to pass a resolution at the annual meeting to post "a written and detailed succession plan."
Apple's directors, though, urged a "no" vote and said while they "strongly support" the concept, they believed the company has "a highly talented and experienced management team, not just the CEO, [that] is critical to Apple's success."
The measure failed. But in giving Cook a salary hike and bonus, Apple's compensation committee said it had "considered Mr. Jobs' recommendations" in doing so. The compensation committee is headed by Andrea Jung, CEO of Avon Products, along with former Vice President Al Gore and Millard Drexler, CEO of J. Crew.
Well. Glad they've got a real expert to guide them.

And now, just to make us think, and because there's more than one way of looking at the two-class issue - the beautiful and "other," the employed and "other" - and because I am more than sympathetic to those in need of food, here's another story. And another cut-and-paste quote for those... like I said.
When children are starving, the most urgent need is to feed them. It seems simple, but is it really?
This is the question humanitarian workers confront on a daily basis at the world's largest refugee complex, in Dadaab, Kenya. The camps here are overflowing now, with more than 400,000 people living in a space designed for 90,000. Every day, 3,000 Somalis are fleeing to Dadaab and other camps in Kenya and Ethiopia to escape the severe drought and famine in their country.
I cringe when asked to sympathize with merchants who feel victimized by incompetent shippers who can't deliver merch to stores on time. Sorry, but that's nowhere near as difficult as getting food, and the wherewithal to cook it, to the starving. In-transit bribes, robberies and "shrinkage" make the "fell off a truck" or "held up in port" guys look like amateurs. You know who should be compensated? The relief workers. And maybe you should have manufactured your merch closer to home.

I usually rant about Labor, sweatshops, and outsourced jobs on Labor Day weekend. This one started when I googled "jobs". So no, I'm not buying a $600 cashmere jacket this fall. And no, I'm not wearing a $1500 calf hair blazer. The goats and calves I'm looking at are on the web at www.heifer.org.


2 comments:

  1. Modern corporate governance is a joke. What else can you expect when board member criss-cross corporations like some complicated flight map, and if CEO1 votes a large comp package for CEO2, what is the likely outcome when CEO2 votes on CEO1's comp package. But at least Apple still brings some value to the US (if nothing else, cache) - what about the CEOs of the big banks/financial institutions? I have many unspeakable words for these foul fiends.

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  2. Kady, totally agree! Especially revolted by the praise given the "safeguards" in puff pieces like annual reports.

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