Should CEO’s be compensated based on the stock price, company earnings, or simply based on Talent? Looking at Yellow Page CEO earnings


executive compensation.jpg

Should CEO’s be compensated based on the stock price, company earnings, or simply based on Talent? Looking at Yellow Page CEO earnings…….

idearclogo1

Scott W. Klein has been the Chief Executive Officer of Idearc, Inc. Since June, 2008. Mr. Klein served as Chief Executive Officer of Symphony Technology Group. He has also served as Operating Partner of Symphony Technology Group since 2007. He served as Chief Executive Officer and President of Information Resources Inc. from February 2, 2004 to October 2007. He has extensive knowledge of operations management and global marketing to Intentia. He was charged with transforming … IRI’s business by focusing on strengthening its core business of market content and analytic services, while extending services through business performance management solutions. Before joining IRI, Mr. Klein served as President of the Consumer Industries, Retail & Energy Division of Electronic Data Systems (EDS) from 2001 to 2004, a global services company. Prior to EDS, he served as President of PC Mall Inc. as well as Chief Executive Officer and President of eCOST.com (a subsidiary of PCMall) from 1999 to 2001, a California-based telesales, catalog, and Internet reseller of IT products while there he successfully launched eCOST.com a premier B to B and B to C online retailer of computer products and consumer electronics. From 1984 to 1999, he served as Chief Operating Officer and an Executive Vice President of PrimeSource Building Products, Inc. and its predecessor companies. Prior to that, Mr. Klein held various marketing and sales positions at PepsiCo Inc. and Procter & Gamble Company. He started his career with Procter & Gamble in Brand Management and later served as Director of Marketing for PepsiCo. Mr. Klein has been a Director of Idearc Inc. Since June 2008. He has been a Director of Intentia International Ab since May 12, 2005. He serves on the Board of Directors of Information Resources, Inc. (IRI). He served as a Director of Lawson International AB since May 12, 2005. He served as Director of PrimeSource Building Products, Inc. Mr. Klein is an honors Accounting graduate of Syracuse University.

ANNUAL COMPENSATION*
Salary $580,769
Bonus $681,846
Total Annual Compensation $1,262,615
STOCK OPTIONS*
Restricted Stock Awards $421,800
All Other Compensation $1,841,120
Unexercisable Options 250,000
Total Number of Options 250,000
TOTAL COMPENSATION*
Total Annual Cash Compensation $1,480,769
Total Short Term Compensation $1,262,615
Other Long Term Compensation $2,262,920
Total Calculated Compensation $3,876,876

_________________________________________Money Bag CEO PAY is NUTS

_________________________________________

RHDonnelley

David C. Swanson serves as President of R.H. Donnelley Directory Company. Mr. Swanson has been Chief Executive Officer of RH Donnelley Corp. and R.H. Donnelley Inc. since May 2002. Mr. Swanson serves as Chief Executive Officer of Dex Media West LLC, Dex Media East LLC and Dex Media Inc. Mr. Swanson served as President and Chief Operating Officer of R.H. Donnelley Corp. from December 2000 to May 2002. Prior to that, Mr. Swanson served as President of Donnelley Directory … Services since March 1999. Mr. Swanson joined R.H. Donnelley Corp. in 1985 as an Account Executive and served senior management positions over 15 years. He served as an Executive Vice President of Sales since 1995. He served as an Executive Vice President and General Manager of Proprietary Operations since 1997. He served as an Executive Vice President of Corporate Strategy in conjunction with R.H. Donnelley Corp.’s spin-off (“Spin-Off”) as an independent public company from The Dun & Bradstreet Corporation (“D&B”) since 1998. Mr. Swanson has been Chairman of RH Donnelley Corp. since April 2006. Mr. Swanson serves as Chairman of Dex Media West LLC, Dex Media East LLC and Dex Media Inc. Mr. Swanson served as Chairman of RH Donnelley Corp. and R.H. Donnelley Inc. from December 2002 to January 2006. Mr. Swanson has been a Director of RH Donnelley Corp. and R.H. Donnelley Inc. since December 2001. Mr. Swanson serves as a Director of Dex Media West LLC, Dex Media East LLC and Dex Media Inc. He serves as a Director of R.H. Donnelley Inc.

ANNUAL COMPENSATION*
Salary $960,247
Total Annual Compensation $960,247
STOCK OPTIONS*
Restricted Stock Awards $774,732
All Other Compensation $145,138
Unexercisable Options 1,170,567
Total Number of Options 1,170,567
TOTAL COMPENSATION*
Total Annual Cash Compensation $1,392,385
Total Short Term Compensation $960,247
Other Long Term Compensation $919,870
Total Calculated Compensation $8,747,562

After all the talk this week about capping executive compensation of companies that received bail-out monies, I thought it might be interesting to see what the annual compensation was for CEO’s of two of the “non-telco” yellow pages publishers. Honestly, I am not supporting caps on compensation, but I do feel like performance, earnings, and benchmarking is something that should be used to determine pay. Most companies use a compensation committee on the Board of Directors to determine pay. So it is usually a network of “friends” that helps determine the pay of many United States CEOs.

So you ask… why post this? A good friend and former co-worker of mine made a comment about CEO pay and I thought I would take a moment to research it further.  Cheers!

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5 Responses to Should CEO’s be compensated based on the stock price, company earnings, or simply based on Talent? Looking at Yellow Page CEO earnings

  1. I also wanted to comment about something local advertising related….. .

    Scott Klein the CEO of Idearc rolled out a new product that many local advertiser’s never knew existed: The Idearc Challenge – Idearc will guarantee advertisers who advertise in the Verizon Yellow Pages to receive more calls than competitive directories. This requires call tracking both directories with Idearc’s tracking lines. If you are up the the challenge, I believe that this might just be a great way of pumping up the industry in a recession while proving value of the core print yellow page product. Something to consider folks. I wonder if he took the idea or the name from the Pepsi Challenge, which he may or may not have been apart of while the Marketing Director for Pepsi Beverage Company. Although like I intentionally failed to state earlier in this blog post, Directors are typically not the level of management that influence creative decisions. Most of marketing is on the local team level, something that Idearc has been significantly reducing over the past few months. But hey, the CEO makes a pretty darn good living!

    and now time for a shameless self promotional plug:

    I am still “working” on my http://www.DallasDIYPPC.com /www.DIYPPCDallas.com website for local Dallas area SMB’s who need help with Google Pay Per Click & Yahoo Search Marketing campaigns. (Not all businesses will qualify as I am plan to offer Search Engine Optimization on an “EXCLUSIVITY” basis. SEO + PPC = AUTOMATIC “LOCAL” EXCLUSIVITY….. rewarding those that do it right!

  2. Mary says:

    As a previous employee that was laid off about 14 months ago in Chicago. I am surprised that the same Managers are still in place. It is insanity. These Managers have been in place for years, have caused some of the problems in the industry and are still there managing the same way and with the same tactics.

  3. Mary,

    Many of the managers are still in place because they are good managers. It is the nature of the business to have both good and bad and the struggle to weed out the bad.

    In my opinion the sales model is what is wrong.

    Accountability after the sale. Sales reps sell. Sales reps do not fulfill or manage. When sales reps are better at managing than account managers who earn 30k per year but feel like they are doing the job of sales…. things don’t often turn out right. Account managers need to be more involved with the client than they are. Unachievable margins make this almost an impossibility. The real issue is the ability to offer products that businesses need (seo, content distribution, social media, google maps etc) while consumers shift to other forms of media (the Internet) for information vs antiquated old phone directories. The directories are great for non-urban Americans… not for the average computer user.

  4. Mary says:

    I am not talking about the front line Managers but the Division Mgrs, Regional Mgrs and Executives in Raleigh, NC. Although front line Mgrs take their directives from divisonal Mgrs. This company has raised it Divisional Mgrs and executives on nepotism. There way of doing business is stuck in the 70’s and 80’s when yellow pages basically ran themselves. They are still managing the same way. I do not believe any company who is not in the black should be paying their CEO’s that much money.

    • As an employee of the company I typically earned 80k-130k per year in my 10 year career. I really do not have an issue with a CEO making 1.2 million. I do have an issue with the companies business model and how it pertained to my clients in the Dallas area. What I do not agree with is folks making money off the efforts of others without rewarding them, thanking them, and mutually sharing the benefits and money. Goes back to political opinion and your personal beliefs I guess. 1.2 Million when the company is tanking, while being reluctant to ask questions or permit folks with differing opinions who want to fix the problem to participate and offer solutions.

      I understand the need for corporate earnings and margins. The company just needs to realize that the CLIENT is first. Delivering on the promise that takes place after every contract is signed should be the #1 concern for the company. Otherwise it is just doing what the banks and regulators are doing….. putting America’s Small and Medium Sized Businesses in Debt…..

      then they make it worse with harassing collections calls from McCarthy Burgess Wolfe and other collectors the company hires.

      I remember a something the CEO once said:
      “I’ve also had the pleasure of meeting and talking with many of you to discuss Idearc’s new way of doing business.”

      and

      When we all gathered last quarter, I talked about Idearc’s three key areas of focus. First, accelerating revenue growth. Second, improving margins and reducing expenses, and Dee will address these in a few minutes. And finally building a high performance culture. Everything Dee and I talk about this morning addresses at least one of these points as we continue to build a solid foundation for success.”

      If they consider radical ideas and changes copying ServiceMagic with the SuperGuarantee (VS the ServiceGuarantee) and they think the same pricing model of old in print, or even the slightest thought that MARGINS and EXPENSES, and a “Performance Culture” is the issue……….. IT ISNT!

      The issues is: Delivering on the promises made by sales reps to clients.

      They can Over-Promise and Under-Deliver….. or change the business model.

      I vote for the second one! Yellow Pages as we know it should be dead….. the industry is killing itself and not one CEO gives a shit about it. All they care about is 1.2 million. If they company wants to survive they need to make real change.

      Media Planners is a step in the right direction!

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