Friday, October 07, 2005
Delphi Execs Get Some Brotherly Love
Troy, Michigan, is the new City of Brotherly Love... if you happen to be a top executive of Delphi, that is.
The struggling auto-parts maker said today that it was giving 21 top executives an additional 6 months of severance pay, for a total of 18 months, and also promised to pay them part of their bonuses if they were terminated or left for a good reason. (link)
According to Delphi, the old severance package wasn't competitive.
Well, to be honest, neither was Delphi.
Those executives have done such a smash-bang job running the company ("into the ground," one might add), it stands to reason they should be well compensated for their efforts. After all, the company is on the brink of bankruptcy. Revenue has sagged, margins are negative. The stock has lost 90% of its value in the past year. The debt is junk.
So the company's board, half of whom are top executives of other companies, showed some brotherly love to their hapless comrades. Call it Phila-Delphi-Uh.
(Meanwhile, those misunderstood geniuses of business are demanding 50% wage cuts from the UAW working stiffs, and canceling a job bank for 4,000 laid-off workers. There's only so much love to go around.)
Delphi's board and management has a fiduciary responsiblity to shareholders. They say so right on their website: The role of the board and management is "to enhance the long-term value of the company for its shareholders." They failed in that duty and rewarded themselves for their failure.
Or maybe they just confused Steve Miller, Delphi's new Charmain and CEO, with Steve Miller, the rock star, who, in his immortal song, told Billy Joe and Bobbie Sue to "Go on, take the money and run." --GAHJr
The struggling auto-parts maker said today that it was giving 21 top executives an additional 6 months of severance pay, for a total of 18 months, and also promised to pay them part of their bonuses if they were terminated or left for a good reason. (link)
According to Delphi, the old severance package wasn't competitive.
Well, to be honest, neither was Delphi.
Those executives have done such a smash-bang job running the company ("into the ground," one might add), it stands to reason they should be well compensated for their efforts. After all, the company is on the brink of bankruptcy. Revenue has sagged, margins are negative. The stock has lost 90% of its value in the past year. The debt is junk.
So the company's board, half of whom are top executives of other companies, showed some brotherly love to their hapless comrades. Call it Phila-Delphi-Uh.
(Meanwhile, those misunderstood geniuses of business are demanding 50% wage cuts from the UAW working stiffs, and canceling a job bank for 4,000 laid-off workers. There's only so much love to go around.)
Delphi's board and management has a fiduciary responsiblity to shareholders. They say so right on their website: The role of the board and management is "to enhance the long-term value of the company for its shareholders." They failed in that duty and rewarded themselves for their failure.
Or maybe they just confused Steve Miller, Delphi's new Charmain and CEO, with Steve Miller, the rock star, who, in his immortal song, told Billy Joe and Bobbie Sue to "Go on, take the money and run." --GAHJr
