Jonar Nader comments on executive payouts that run into the millions. It seems that good and bad managers are rewarded. Jonar suggests that some payouts are aimed at silencing the executives. Further below is a transcript of the video.
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Here is the transcript:
Naomi Robson: Now, to the extraordinary about face by one of Australia’s richest bosses. When Paul Anderson left BHP, he pocketed $18 million but now, with his money safely in the bank, he’s decided to hit out with the huge payouts to other corporate high flyers.
Paul Anderson: It’s time to pause and let the marketplace settle down and then recalibrate what’s appropriate for executive compensation.
Naomi Robson: That’s double talk for a very simple message. Fat cat bosses, your days are numbered. Paul Anderson, he just pocketed a staggering $18 million for quitting his job as one of Australia’s highest paid bosses, chief of BHP.
Paul Anderson: I believe the time is right for boards to take a hiatus on the annual market review of executive compensation.
Naomi Robson: Hypocritical? You be the judge. Now, he’s calling for a freeze on executive payouts even though his is the largest ever handed out in Australia.
Gerry Harvey: He’s only there for five minutes on the job, flick the company into another company, walks away with millions of dollars and he’s a genius. I don’t know that even if they figured out what was happening at BHP and that’s only my opinion.
Naomi Robson: Star CEO, Gerry Harvey is one of Australia’s most successful self-made millionaires. Even he can’t believe some of the money that’s being thrown around.
Gerry Harvey: In a lot of cases, it is criminal because you’ve had these people that are, you know, it’s like – it’s like why are they getting all this money for something that they – they don’t deserve.
Naomi Robson: Wouldn’t it be good indeed. And there’s plenty going around. Have a look at these jackpot winners paid mega millions from their listed companies for retiring, failing, even bailing. George Trumbull departed AMP with a whooping $12.12 million payout. And what about BHP boss, John Prescott. He pocketed $11.17 million despite the company writing off billions under his leadership. Then there’s Dennis Eck of Coles Myer, happy as Larry jumping ship with a cool $8.65 million bounty.
Jonar Nader: Executives today are celebrities, not perhaps as well known in every house but they’re certainly very well-known in every boardroom.
Naomi Robson: Author of How to Lose Friends and Infuriate Your Boss, Jonar Nader, believes many executives sign on knowing it’s only for the short-term. He says, the golden handshake is silence money.
Jonar Nader: Really, in a way, it’s a golden handcuff rather than golden handshake.
Mark Markson: If you’re on movie studio and you want to make a hot movie, so you’ll – you’ll buy Tom Cruise for $20 million or Mel Gibson or Julia Roberts. It’s the same with corporations.
Naomi Robson: These days, star CEOs are being head-hunted like movie stars and top athletes. Sports agent, Max Markson says, “It’s justified considering the currency they can generate.”
Mark Markson: They’re blank talent exactly the same as a football team.
Gerry Harvey: I think when an executive has done a terrible job in a company and they’ve been there, one, two, three, four years and they walk away with millions of dollars, I think it’s just dreadful. And they’re to fix all the good people out there in the business world.
Naomi Robson: They’re coming up the bottom line.