CEO Davis's & BOD Compensation

Discussion in 'UPS Information Technology' started by Peak Supr, Oct 26, 2007.

  1. Peak Supr

    Peak Supr Guest

    Will Scott Davis & the BOD receive their compensation tied to stock price ?......I understand that the CEO & Board will now be held to the standards of the public companies where if the stock value does not increase 10% each year the CEO & BOD members are forced out.......I sure hope poor performance is not going to continue to be tolerated.......
     
  2. Need4Speed

    Need4Speed New Member

    The BOD decided a couple of years ago to base the MIP award on the performance of a few "elements" that may have little to do with the profitibility of the company (obviously this is the case, since we have record profits this year - but the 2007 "elements" were well below plan). How about basing their salary package on these "elements" - then let's see how quickly they switch back to a fair MIP measurement!
     
  3. pretzel_man

    pretzel_man Well-Known Member

    While they are certainly not hurting for money, the majority of the compensation for the management committee is based on these financial elements.

    They get MIP just like everyone else, calculated the same.
    They get Stock options that are tied to stock growth.
    They get LTIP which is tied to financial elements.

    They do get a nice salary, but compared to their peers, they are grossly underpaid in that category.

    As I recall, Mike Eskew was on the list (compiled by forbes I think) of the most underpaid CEO's. Davis will be in the same range.

    Again, they are not hurting, but the key here is to get the stock to grow.

    P-Man
     
  4. Need4Speed

    Need4Speed New Member

    My point was not so much a statement of dissatisfaction at his salary level. I'd have gladly traded UPS CEO Mike Eskew (at his lower salary) for FedEx CEO Fred Smith (at his higher salary). Heck, I'd have sweetened the pot even more to get Fred.

    I guess my statement was really just a venting of my frustration about the fact that at many of the decisions he made (hold half of stock award in 5 year escrow, change the method of quantifying the MIP award, etc..) only served to completely neuter the concept of a partnership that was so sacred to the company I once knew.

    That being said, you're exactly right in saying that Davis and Eskew are just as affected by these decisions as we are. I just wish we would decide whether we want to be the old company (partnership, modestly paid executives that are promoted from within, and a TRUE sense of ownership/partnership for all in management) or whether we want to be more like the typical Fortune 500 company (CEO's who are true leaders - who know how to motivate employees, expectations of higher ROI, and a boot out the door for the CEO when expectations are not met). It seems we are stuck somewhere in the middle, with no end in sight. I don't know about you, but I'm not happy that the value of my stock is that same as it was on the opening day of the UPS IPO, years and years ago.
     
  5. pretzel_man

    pretzel_man Well-Known Member

    Need:

    I feel similar frustrations... To me the biggest issue is the stock not moving.

    When I started in management, we didn't expect large MIP's. We worked our buts off, and took any assignment that came along.

    However, we had the reward of stock GROWTH that made those sacrifices worthwhile. I really believe that if stock was growing, much of the complaints of today would go away.

    I think people would tolerate the 50% MIP RSU's, and the change in MIP payouts and the harder work in the centers.

    Its sad that those changes were designed to make the stock grow. I'm still waiting for that to happen.

    P-Man
     
  6. Dfigtree

    Dfigtree New Member

     
  7. lr1937

    lr1937 New Member

    I think this compensation package goes against UPS past philosophy and Jim Casey's business plan. While I was working the salary of management was reasonable and fair. A $13 mil package is not what I think UPS is all about. It is now about meeting quarterly numbers and paying top officials more than they need. I don't know what his life insurance policy is but I never got one. $5934 pension benefits is a puzzle to me. I guess when he retires he will have one hell of a pension making mine look worthless. How about $14885 for financial planning. Whats there to plan for when he will probably leave the company with more money than he can ever use? What is $566,966 in non equity incentive plan for when he got $9.5 mil in stock awards? and $450,807 in option awards? Why would he need $566,966 when he already got $10mil in stock incentives.
    He got an increase of $6623 in health care benefits when I and many others lost some health care benefits. I know my supplemental costs and Part D costs will be much more the the UPS reimbursement. I was told my heath care benefits would be grandfathered when I retired. I guess Davis is my grandfather now that he got an increase and I had mine cut.
    I have always trusted UPS to be fair and ethical. I was disappointed with the health care stuff but this compensation package has changed my whole attitude towards UPS. I was always hesitant to sell ups stock and did so at a slow pace. I will no longer be hesitant.
    It would be good if our proxy vote could be used to deny this kind of stuff but I think the A share board has control so voting would be a waste. I could be wrong on this point.
    I think this compensation package could be used define greed and is one of the problems in our country right now and may very well become problematic for the company.
    JMHO1937