For 13 years as chairman and chief executive, Lee R. Raymond propelled Exxon, the successor to John D. Rockefeller's Standard Oil Trust, to the pinnacle of the oil world.

Under Mr. Raymond, the company's market value increased fourfold to $375 billion, overtaking BP as the largest oil company and General Electric as the largest American corporation. Net income soared from $4.8 billion in 1992 to last year's record-setting $36.13 billion.

Shareholders benefited handsomely on Mr. Raymond's watch. The price of Exxon's shares rose an average of 13 percent a year. The company, now known as Exxon Mobil, paid $67 billion in total dividends.

For his efforts, Mr. Raymond, who retired in December, was compensated more than $686 million from 1993 to 2005, according to an analysis done for The New York Times by Brian Foley, an independent compensation consultant. That is $144,573 for each day he spent leading Exxon's "God pod," as the executive suite at the company's headquarters in Irving, Tex., is known.


http://www.nytimes.com/2006/04/15/business/15pay.html?ex=1302753600&en=89993dc20e1e7e97&ei=5090&partner=rssuserland&emc=rss

Ouch! Last I checked, gas was $2.80 here for 87. :( Today's question is:


Should the federal gov't implement salary caps on the wages of executives in the oil business? Or should the principle of laisez-faire capitalism be the determining factor?

http://www.nytimes.com/2006/04/15/business/15pay.html?ex=1302753600&en=89993dc20e1e7e97&ei=5090&partner=rssuserland&emc=rss

Ouch! Last I checked, gas was $2.80 here for 87. :( Today's question is:


Should the federal gov't implement salary caps on the wages of executives in the oil business? Or should the principle of laisez-faire capitalism be the determining factor?

Answer: No.

If you don't like how Exxon does business, do not spend your money on their products, and services.

Answer: No.

If you don't like how Exxon does business, do not spend your money on their products, and services.

What you said. :nice:

Answer: No.

If you don't like how Exxon does business, do not spend your money on their products, and services.
Oh how I wish L.A.'s public transportation didn't suck so much, it's my biggest complaint about this town. :(

I haven't purchased exxon mobile products since i was 16 ('cept when in LA and almost out of gas)... i plan on boycotting the company for the rest of my life. I know about 10 other people doing the same thing.

I too have only purchased exxon mobile gas when the only other option is pushing my car since I was about 18.

how come noone cared about how much these companies were making back when gas was a buck? Where was the outrage then?

:rolleyes:

I hate high gas prices as much as the next, and wish something could be done, but not allowing business to prosper.... that's just wrong

Should the federal gov't implement salary caps on the wages of executives in the oil business? Or should the principle of laisez-faire capitalism be the determining factor?


No. Oil company shareholders should be outraged by these excessive compensation schemes - and demand reform and better oversight by their boards.

how come noone cared about how much these companies were making back when gas was a buck? Where was the outrage then?

:rolleyes:



*veracity taps mic, testing 1-2-3 testing*

uh Kraw, I think it has alot to do with the fact that gas is damn near double that now.

I wonder if the shareholders really knew this was happening? Meaning, was there full disclosure?
If the shareholders were aware of the CEO's compensation, then I agree the government should stay out of it.

I wonder if the shareholders really knew this was happening?
Why would they care? I could see them caring if they've consistently lost money, but they're making record profits. With the money they've made on stock he's earned it.

Why would they care? I could see them caring if they've consistently lost money, but they're making record profits. With the money they've made on stock he's earned it.


probly inside trading . Anyway this is about the same as pro atheletes make playing games . And movie scars make alot too . No wonder we are going down the tubes !:eek7:

This clan of no talent scumbags [imo] ,run this nation of serfs .

Gasoline isn't a vacation in the Bahama's, it's a necessity, just like water or electricity. That is why the shit hit the fan when Enron was charging 20 times the normal cost per kilowattt hour here in Ca back in 2001.

It would be great to just boycott gasoline,, but that would everybody would have to also quit their jobs, stop going to school, and basically just sit at home and wait for the starvation to kick in. But you'll never hear that from the people that cheer on this diseased plutocracy we live in.

No. Oil company shareholders should be outraged by these excessive compensation schemes - and demand reform and better oversight by their boards.
Considering the appreciation of the value of their assets he effected, why should they care? They're probably too busy rolling in $$$. :rolleyes:

Considering the appreciation of the value of their assets he effected, why should they care? They're probably too busy rolling in $$$. :rolleyes:


The hysteria to regulate CEO compensation is a good reason for any sharedholder to be up in arms. A CEO who invites additional regulation has harmed the future viability of the business.

uh Kraw, I think it has alot to do with the fact that gas is damn near double that now.

Correction: Gas prices have tripled (not doubled).

I read that Exxon still owes 5 billion to Alaska fishermen for 1989 oil spill.

http://www.huffingtonpost.com/2005/11/09/exxonmobil-still-owes-5b_n_10358.html

The hysteria to regulate CEO compensation is a good reason for any sharedholder to be up in arms. A CEO who invites additional regulation has harmed the future viability of the business.
He invited nothing; he just got the best deal for himself he could. It's hardly his fault the public doesn't like it.

Theoretically, everyone should be happy - the shareholders made money, he made money, the economy was driven forward.

He invited nothing; he just got the best deal for himself he could. It's hardly his fault the public doesn't like it.

Theoretically, everyone should be happy - the shareholders made money, he made money, the economy was driven forward.


That is not an accurate assessment. Considering the PR impact and resulting discussions to regulate CEO pay, it is not just a matter of getting the best possible deal at present. A provocative pay package undermines other objectives for the company - one of which should be to maintain maximum degrees of freedom from government interference. The more government oversight, the less investment for the growth areas of the business.

This particular CEO didn't invent oil - he is a manager. Instead of acting like one, he behaved like a short term arbitrage speculator.

The chance the state is about to criminalize legitimately awarded compensation to an executive whose corporation made vast amounts of money for its shareholders is about nada.

It would piss off every corporate donor to those legislators' campaigns without just cause.

Who said anything about criminalizing comp? What is being discussed by grandstanding politicians is to regulate how much CEOs can be paid - which is not going to benefit anyone except the politicians during their election campaigns.

The real issue is leadership - and the Exxon CEO demonstrated very poor leadership by taking advantage of an overly lucrative pay package (the board members also deserve to be replaced). The negative PR and politicization are not good for the company - no matter how anyone tries to spin it.

Criminalizing HIS level of compensation was what what I meant.

Why would the Senate risk pissing off all their corporate donors without cause?

And why was his compensation "excessive" in light of the vast revenue his stewardship produced, & the attendant share price appreciation?

If they lost money, that'd be different.

Criminalizing HIS level of compensation was what what I meant.

Why would the Senate risk pissing off all their corporate donors without cause?

And why was his compensation "excessive" in light of the vast revenue his stewardship produced, & the attendant share price appreciation?

If they lost money, that'd be different.


The Senate is not going to criminalize high levels of compensation. To do so would be too direct and too honest. Instead, they will continue the soft erosion into Socialism via regulations and taxation.

The compensation levels are excessive, imo, for the following reasons:

- The CEO did not invent oil. The profit / share price increases are largely due to global economic and political factors outside of his control.
- I am opposed to such a vast difference between CEO pay and the rank and file workers. (And this is not due to the typical Socialist view that everyone should be compensated the same). It is a leadership issue. The workforce becomes incredibly alienated and doesn't function as effectively as a team when pay scales are hyper-skewed.
- The shareholders would be better off having the profits reinvested into alternative forms of energy than to pay them out to the CEO.

Raising the payroll tax specifically for CEOs? That'll bring in the campaign dollars!!

Raising the payroll tax specifically for CEOs? That'll bring in the campaign dollars!!


^ Creeping Socialism On Parade.

Yes. CEO salaries should be capped.

I'd lynch that bastard just because he's rich, and for that reason only.

I'd lynch that bastard just because he's rich, and for that reason only.

call me if you need help.

:rolleyes:

Envying others their success is not a good way to live.

it's not envy. it's utter revulsion. :|

- The CEO did not invent oil.
Red herring - he's paid primarily in stock options & not royalties.
The profit / share price increases are largely due to global economic and political factors outside of his control.
If that's true, then why didn't all the other oil companies do as well? They all share the same geopolitical economic environment. Obviously, his leadership was an important factor in the equation.

- I am opposed to such a vast difference between CEO pay and the rank and file workers. (And this is not due to the typical Socialist view that everyone should be compensated the same). It is a leadership issue. The workforce becomes incredibly alienated and doesn't function as effectively as a team when pay scales are hyper-skewed.
I don't see why such a strategic management issue should be the object of legislation by the state - it's the corporations profits that would suffer if you were correct - but I don't necessarily view your opinion here as indubitable at any rate.

You could easily make the argument that working for the company with the highest paid chief executive would be a point of pride for the employees, who hardly expect to be compensated on the same level as their CEO.
The shareholders would be better off having the profits reinvested into alternative forms of energy than to pay them out to the CEO.
Given the tangible financial rewards of the CEO's management, he probably is their most important asset & failing to compensate him at the level he negotiated would likely impair their ability to retain him.

^ Creeping Socialism On Parade.
How is noting that Congress would be exceedingly unlikely to alienate their biggest funding source "socialism"?

Red herring - he's paid primarily in stock options & not royalties.

They are all costs of doing business. Options are expensed just as are royalties.

If that's true, then why didn't all the other oil companies do as well? They all share the same geopolitical economic environment. Obviously, his leadership was an important factor in the equation.

I agree that leadership matters - but the true test of leadership is the impact on the team. I've been around corporations long enough to know that excessive exec comp is a big demoralizer for the workforce. At some point, the company will face a business crisis which may threaten restructuring and lay-offs. Sadly, because morale is low, the lay-offs, which may have been avoided if the team were functioning effectively, become a self-fullfilling prophecy.

The success of a company depends upon far more than the CEO - it is a team effort. It would not be risky to wager that this CEO's comp has had a serious impact on internal morale at Exxon.

I don't see why such a strategic management issue should be the object of legislation by the state - it's the corporations profits that would suffer if you were correct - but I don't necessarily view your opinion here as indubitable at any rate.

I don't believe there should be any government interference. My comments are as a business executive who, if I were on the board or a shareholder, would be personally outraged by this comp arrangement.

You could easily make the argument that working for the company with the highest paid chief executive would be a point of pride for the employees, who hardly expect to be compensated on the same level as their CEO.

Having worked in a couple of such companies, I can personally testify that employees do not feel such pride. Imperial CEOs often create a toxic value system - which makes working for them a quite stressful and unpleasant experience.

Given the tangible financial rewards of the CEO's management, he probably is their most important asset & failing to compensate him at the level he negotiated would likely impair their ability to retain him.

Corporations are not Rock Bands. The challenge of management is to develop a company that is not Personality Dependent - but a sustainable and growing "eco-system". CEOs are managers - the real value is created by the people they lead and the relationships they manage.

So I am left with questioning what the impact is of such an excessive comp package on the morale and organization within Exxon. My assessment is that it isn't good.

They are all costs of doing business. Options are expensed just as are royalties.
Options are a performance incentive, whilst royalties are not.

I agree that leadership matters - but the true test of leadership is the impact on the team. I've been around corporations long enough to know that excessive exec comp is a big demoralizer for the workforce.
If it were all in salary, it'd be one thing, but stock options tied to company performance are quite another.
At some point, the company will face a business crisis which may threaten restructuring and lay-offs. Sadly, because morale is low, the lay-offs, which may have been avoided if the team were functioning effectively, become a self-fullfilling prophecy.

The success of a company depends upon far more than the CEO - it is a team effort. It would not be risky to wager that this CEO's comp has had a serious impact on internal morale at Exxon.
Hard to believe - the economic success of the company could not be due solely to the CEO: it had to be a function of teamwork generally across the corporation.

Ipso facto, the CEO was inspiring teamwork & generating morale.
I don't believe there should be any government interference. My comments are as a business executive who, if I were on the board or a shareholder, would be personally outraged by this comp arrangement.

Having worked in a couple of such companies, I can personally testify that employees do not feel such pride. Imperial CEOs often create a toxic value system - which makes working for them a quite stressful and unpleasant experience.
As a guy who's never had a real "job," I defer to you, ma'am. :D :nice:

Corporations are not Rock Bands.
You got me there. :bang:

Options are a performance incentive, whilst royalties are not.

If it were all in salary, it'd be one thing, but stock options tied to company performance are quite another.


Not the way many are implemented. The performance bar is often set at an absurdly low level due to cozy board/insider relations

Hard to believe - the economic success of the company could not be due solely to the CEO: it had to be a function of teamwork generally across the corporation.

Ipso facto, the CEO was inspiring teamwork & generating morale.

It's quite easy to believe. There are many execs that are completely out of touch with their rank and file workers - especially in mega-corporations. The real work depends more on the leadership of mid and frontline managers. The major impact the execs have is on vision and values - and self-dealing undermines both.

As a guy who's never had a real "job," I defer to you, ma'am. :D :nice:



Whatever you say, Sir. Sadly, Sir is not really an adequate counterpart to Ma'am.

:mad:

I still fail to understand your big issue with "ma'am." :rolleyes:

As I can safely assume that nobody has ever called you "Ma'am", I don't expect you to understand.

It's A Chick Thang. The gals grok why.

I have a funny story about the first time anyone ever called me Ma'am. I will post it in the Amusing Me Today thread in my journal later today. But now, I have to wrap up Sales Launch Week. Thank the Goddess: it is almost over.

^ You've never seen me in garter belt & hose.

Is "madam" an acceptable substitute?

That would depend on the context and how you say it.

I've seen that pic, btw.

Boe,I agree with you 100%.

Not the way many are implemented. The performance bar is often set at an absurdly low level due to cozy board/insider relations
I'll point out that the bar didn't need to be set low - he performed.

It's quite easy to believe. There are many execs that are completely out of touch with their rank and file workers - especially in mega-corporations. The real work depends more on the leadership of mid and frontline managers. The major impact the execs have is on vision and values - and self-dealing undermines both.

Is there evidence that happened here?

Question: Is the gov't subsidizing any of these oil companies?

Boe,I agree with you 100%.


^ Smart.

I'll point out that the bar didn't need to be set low - he performed.

No, macro-economic events pumped up supply costs and he rode the margin multiple.


Is there evidence that happened here?

It's my theory and I'm sticking to it.

I'll point out that the bar didn't need to be set low - he performed.

Regardless of the reasons behind a company's fortunes, the CEO gets the credit and the blame. The same thing happens to presidents. There's a reason why most CEO's don't work all that long at any one company.

^ Smart.

I am in the corporate world. I work for a company that just went public a month ago. Not to mention a previous CEO gave himself a $200 million retirement package. It does breed resentment.

I know that I wouldnt feel happy about an executive giving himself a hefty sum of money while I am having a hard time scraping enough money every month to pay rent.

It's difficult to develop loyalty if a manager is viewed as a manipulative self-dealer. Excessive comp creates that perception.

No, macro-economic events pumped up supply costs and he rode the margin multiple.
Then again, why wasn't that true for all the rest of Big Oil?

It's my theory and I'm sticking to it.
Fair enough.

Then again, why wasn't that true for all the rest of Big Oil?

Exxon's results are not dramatically different enough than Chevron's or BP's to warrant such a pay package. Exxon's operating profit margin is 16% (which I believe is buffered by selling investments or assets - the cashflow statement include $6B from investing activities. If I'm correct, this would add 1.5 margins pts.) Chevron's is 12%; BP's is 13%.

Boe, when you're talking about the kind of annual revenue the major oil suppliers bring in, a 3-4% margin over the competitors is a big deal.

Any large company can pump up operating profit margins to meet short term profit goals by selling off assets. (Enron took this to the extreme). The cash flow statement indicates that this method was used.

I haven't done an indepth analysis - but I stand by my impression that the comp was excessive and is going to create morale issues. Just wait until the regulatory hammer falls.

You haven't explained WHY Congress would legislate.

Haven't you paid attention to the news? This comp is a PR debacle - and is being used as fodder to regulate corporate compensation and create windfall profit taxes.

Despite the slow economy & manifold corporate donation base?

Regulating how PRIVATE companies spend THEIR money on their own employees (yes, the CEO is an employee) will accomplish absolutely nothing for consumers.

The only way to keep energy companies honest is through competition, and the only way to do that is to make it as easy as possible for start-ups to enter the market. Which means less regulation, not more.

Despite the slow economy & manifold corporate donation base?


Slow economy? That is Former Elite Moonbat Media On The Skids misreporting.

Unemployment is below 5%. GNP is growing at a decent rate - to the extent that the Fed keeps raising interest rates due to inflationary concerns.

Corporate donations won't outweigh the self-interest driven politics of those with populist agendas.

Slow economy? That is Former Elite Moonbat Media On The Skids misreporting.

Unemployment is below 5%. GNP is growing at a decent rate - to the extent that the Fed keeps raising interest rates due to inflationary concerns.

Corporate donations won't outweigh the self-interest driven politics of those with populist agendas.

No kidding. This kind of economic news reported during Clinton's regime would have had them ready to anoint him king.

Should the federal gov't implement salary caps on the wages of executives in the oil businessPresident Bush has been stressing drilling for our own. So many restrictions,we must ease them. We must allow more companies invest and sell gas. Same with the phone companies,natural gas. We are monopolizing, and that is against the law {shhhh**. If we don't do something soon,China and India will began to go from bicycles to cars.This is not a joke. China is expected to have 700,000,000 drivers by 2010. I think America has over 200,000,000. India will have about 500,000,000 drivers by 2010.The third world is catching up,and we are falling behind.

Regulating how PRIVATE companies spend THEIR money on their own employees We shouldn't have caps on salaries and bonuses, but we should have a cap on the price in a given amount of time renewed on a yearly basis, reward for investing. In other words, you can only make a certain amount of money per gallon sold. It would be $ 2.50 a gallon for one year,then go back in and see if there is any investment, if not, keep it at $2.50 a gallon.

We shouldn't have caps on salaries and bonuses, but we should have a cap on the price in a given amount of time renewed on a yearly basis, reward for investing. In other words, you can only make a certain amount of money per gallon sold. It would be $ 2.50 a gallon for one year,then go back in and see if there is any investment, if not, keep it at $2.50 a gallon.

That fixes only the PRICE. It does nothing for the COST. If you keep the price artificially lower than what is required to generate profit, you make it impossible for business to continue. It sounds to me like people want to punish Exxon for being successful. If you had been arguing for price supports back when gas was cheap, you might have a valid point.