27 ms·

So why not make the golden parachute "if we get acquired, you get this" instead of "if you get fired, you get this".

• pdeuchler 10y ago
  Because CEOs didn't get there by not knowing how to negotiate and insulate yourself from risk
• ohyes 10y ago
  What's to stop the board from firing him and then doing the acquisition to save the money that they would have had to pay him.
  • st3v3r 10y ago
    In theory? Not much. In reality? For one, that's a lot of work, especially to screw someone who did a decent job (presumably), who's compensation probably is a drop in the bucket compared to the stock price, and, let's be honest, has a chance to be on your board. The amount of incest in company boards is pretty high. So if you do it to them, there's a chance they'll do it to you.
• rhino369 10y ago
  They did originally. I think even now most big CEO's don't have a really huge golden parachute. And at a certain point, it's just differed compensation. Instead of 2 million a year and zero parachute, they get 1.75 million a year and a million dollar chute. There is also another form of golden parachute, which the person is getting paid for getting on a sinking ship. Otherwise nobody is going to become the CEO of a failing company. They are basically getting paid for the hit to their reputation.
• SeeDave 10y ago
  This exists, it's called a "Change in Control" arrangement.