Governance Reforms Fail to Rein in US Executive Pay
Byline: Kit Bingham
US corporate governance has been overhauled in the past two years, but executive pay has escaped virtually unscathed.Chief executives' contracts in the US are typically of a generosity and security that would be unacceptable in Europe. The issue came under the spotlight with the recent acquisition by JP Morgan Chase of Bank One, and the naming of Jamie Dimon as the chief executive-in-waiting of the combined group.
As revealed by Financial News last week, Dimon's Bank One contract ensured that he does not need a bonus from the JP Morgan Chase deal to make money. Dimon's package was for five years and guaranteed a bonus, an annual grant of either shares or options worth $7m ([euro]5.6m) plus a two-year pension contribution for each year of service.
The contract was ring-fenced so that it would pay …
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Publication information: Article title: Governance Reforms Fail to Rein in US Executive Pay. Contributors: Not available. Newspaper title: Financial News. Publication date: January 25, 2004. Page number: Not available. © Not available. COPYRIGHT 2004 Gale Group.
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