It's been a tough year for CEOs.
The credit crunch and housing crisis led to some high-profile firings, most notably Merrill Lynch's Stan O'Neal and Citigroup's Chuck Prince. Still, while they lost their jobs, these executives didn't lose their shirts.
A review of Securities and Exchange Commission filings of 14 companies where CEOs stepped down found only one — Starwood — sent its CEO packing without any kind of payout. Steven Heyer was dismissed with cause from the hotel operator, and left with only $13 million dollars in stock he already owned.
Other CEOs walked away much richer men (yes they were all men). Unofficially, they may have been fired, but the official word from many of their former employers was they "retired."
For these CEOs, "retirement" means they get a lot more than a gold watch, they get to keep the money they've socked away in retirement and executive savings plans, and in many cases, the stock options the boards gave them for performances in years past.
As a result, according to an analysis of SEC filings by the compensation consultant James F. Reda & Associates, the remaining 13 former CEOs received final payouts in salary, pension plans and other benefits (left with golden parachutes) ranging from the $858,000 given to Jet Blue's former CEO and co-founder David Neeleman, to the $165,000,000 Bob Nardelli walked away with when he left Home Depot . The numbers jump signficantly when you add in the stock these men already owned in the companies they used to run, with Neeleman leaving with $118,000,000, and Nardelli $209,000,000.
What many of them did not get, were severance payments — cash payouts that might be required by a contract, or given at a board's discretion. Sensitive to shareholder outrage over excessive CEO pay, boards appear to be more reluctant to give cash severance payouts to former CEOs.
When Stan O'Neal stepped down at Merrill Lynch, the company's board was quick to point out he didn't receive any severance, just $159,085,201 which included stock he already owned, over $39 million in stock options, $24 million in a pension plan and $4.8 million in a deferred compensation plan.
James Reda, president of the compensation firm that bears his name describes this year as an "extraordinary" one for CEO exit payouts, thanks in part to the appreciation of the very generous stock grants the executives were given in years past. He says you can expect to see other big payouts if other CEOs from the financial and housing industries lose their jobs in the new year.