| Recently, there are more and more CEOs | | | | still stayed in the same house that he bought |
| falling from grace. In the United States, | | | | thirty years ago and drew on a salary of US |
| forced exits accounted for 39% of CEO | | | | 100,000 per annum. Ingvar Kamprad, the |
| departures in 2002 up from 25 % in 2001, | | | | founder of Ikea takes the company bus to his |
| according to Booz Allen Hamilton. In 2002, | | | | stores. |
| Enron Chairman Ken Lay, Tyco chief Dennis | | | | |
| Kozlowski, Qwest's Joe Nacchio, Worldcom's | | | | Indeed examples of executive abuses dominated |
| Bernie Ebbers. Year 2003 saw the departure of | | | | the news during 2002. Many Enron employees |
| CEOs from Raytheon, Kmart, Spiegel, Scherling | | | | were fired whilst Senior Executives used |
| Plough, Motorola, Freddie Mac, Boeing, | | | | $200,000 to fund its luxury box at the |
| American, etc. | | | | formerly named Enron Field. Though founded on |
| | | | the innovative idea of instant photography, |
| Agence France-Presse (AFP) in 13 April 2004 | | | | Polaroid's management failed to save the |
| reported that Professor David Yermack of New | | | | company from the shift to digital cameras. |
| York University Stern School of Business | | | | Polaroid reportedly cancelled health-care |
| found that the average shareholder gains | | | | benefits for the company's retirees in the |
| underperformed market benchmarks at companies | | | | wake of its Chapter 11 filing. However, |
| where the chief flies by luxurious corporate | | | | management reportedly petitioned the |
| jets. In the study, 'Flights of Fancy: | | | | bankruptcy court for permission to dole out |
| Corporate Jets, CEO Perquisites and Inferior | | | | roughly $19 million in bonuses to keep key |
| Shareholder Returns', Professor Yermack said: | | | | executives from leaving. Webvan is another |
| "The central result of this study is that | | | | example. It failed to compete against the |
| CEO's personal use of company aircraft is | | | | traditional supermarkets with its online |
| associated with severe and significant | | | | shopping services and home delivery. Before |
| under-performance of their employers'stock. | | | | it ceased operations, the company reportedly |
| Firms'stock prices drop an average of 2 | | | | agreed to pay its resigning CEO, George |
| percent around the date of initial disclosure | | | | Shaheen, $375,000 per year for life although |
| of corporate plane use." | | | | the Webvan's stock price plunged 99 percent |
| | | | during his tenure. |
| Some of the CEOs may not be justifiably fired | | | | |
| as the economy turns bad through no faults of | | | | Kmart in bankruptcy authorised payments of |
| theirs' but they were held accountable. | | | | $362,000 per month in retirement benefits to |
| However, the days of fat cats running | | | | some 242 of its executives. The Kmart's |
| corporations are over. | | | | creditors which K mart owed $6 billion |
| | | | protested to a Chicago bankruptcy judge. |
| Uncontrolled and unnecessary costs destroy | | | | |
| businesses. If your competitor has a limo and | | | | L A Times writer John Balzar observed that |
| you do not, you are already winning. He has a | | | | creditors and shareholders are not the only |
| leaky bucket. There are six self-made | | | | ones enraged at the seemingly arrogant |
| multi-billionaires. And all of them were | | | | attitudes of America's corporate giants. |
| paragons of simplicity and prudence in | | | | "Consumers are mad, and some are declaring |
| self-aggrandisement. | | | | petty war against the mighty corporation, |
| | | | against shenanigans, the double-dealing, the |
| In 1991, Sam Walton founder of Wal-Mart drove | | | | get-rich-quick schemes, the fraud, the |
| an eight-year-old red Ford pickup. He always | | | | selfserving deals." Those investors felt that |
| fetched his own coffee. As President of EDS, | | | | they have been robbed as they saw their |
| Ross Perot paid himself $70,000 a year. | | | | retirement savings dwindled. |
| However, when Perot sold EDS to General | | | | |
| Motors, the President of General Motors, | | | | In America, CEOs compensation surged 1000% in |
| Perot's new boss, made $2.4 million salary | | | | three decades, making it to 500 times the pay |
| plus a bonus. Finally, he paid Perot $2.5 | | | | of the average worker. Yet, they are greedy |
| billion to go away because GM executives were | | | | for more. Martha Stewart of the ImClone |
| embarrassed by the folksy Perot, who did not | | | | System expensed off the US 17,000 cost of a |
| demand a fat salary or swanky office or | | | | holiday to her company. Dennis Kozlowski |
| specially tuned cars. David Packard never had | | | | spent US$15,000 on a 'dog umbrella stand' and |
| an enclosed office before he left | | | | US$6000 on shower curtain. John Rigas spent |
| Hewlett-Packard for government service. Bill | | | | US $20,000 of Adelphia's shareholders' funds |
| Gates of Microsoft often rode coach on | | | | on a Christmas tree. The list of corporate |
| planes, until they finally got so big they | | | | excesses goes on and on. |
| ran their own fleet of aircraft. Warren | | | | |
| Buffet manages Berkshire Hathaway's billions | | | | CEOs who live 'fat cat' lifestyles using |
| and billions with a staff of 24. When they | | | | corporate funds should be slaughtered and |
| lunch together, it is McDonald's. Warren | | | | skinned. |