News - Coca-Cola
For being the pause that enriches for its execs
No wonder Coke has such a hard time hanging on to its top executives. When you’re being paid so handsomely to leave, why the hell would you stick around?
In case you missed last week’s news item about the pending departure of Coke’s No. 2 honcho, Steven Heyer, we’ll skip right to the juicy part that was buried seven paragraphs down in the June 10 AJC story: Heyer’s $24 million severance payday.
Here’s a guy who joined the company only three years ago and had served as president for the past year-and-a-half. When he was passed over recently for the job of CEO, he got all snitty and resigned. For that act of corporate petulance, Heyer gets to leave with a cool 24 million bucks.
How did it become accepted practice at American companies for executives to be invited to clean out the till on their way out the door? Coke’s last two top Dougs, Ivester and Daft, both left after relatively brief, uncelebrated tenures — yet still stand to pocket a combined $136 million. And the free-falling Delta used its bailout money from Congress to dole out $42 million to a number of top executives — many of whom then bolted for the exit ramp. Embattled ex-CEO Leo Mullin bailed out with a $16 million golden parachute. Sweet.
More than two decades ago, the late Ronald Reagan spun a tale of “welfare queens” driving around in Cadillacs they’d bought from food-stamp fraud. The nation was outraged and eventually supported full-scale welfare reform. Even if Reagan’s story had been true, how does that kind of penny-ante graft compare to the robber-baron shenanigans that go on in America’s corporate boardrooms with gruesome regularity? And if you think that none of your tax dollars — in the form of corporate tax breaks, government subsidies, etc. — is helping to line these guys’ pockets, you’re fooling yourself.
Heyer’s cash-out is so egregious that even the pro-business Wall Street Journal ran a long, scathing story about it June 11 (followed the next day by the AJC). Are we being too cynical for assuming that outrage alone will do little to curb this business as usual?