Friday, 16 November 2007

Saskatchewan CEO's hit the payroll jackpot

This article in the Friday, Nov. 16, 2007 Regina Leader-Post reveals that a number of Saskatchewan based CEO's hit the payroll jackpot last year.

According to the article, which quotes the Financial Post Business magazine, the following CEO's received compensation last year as listed below:

Gerald Grandey, CEO of Cameco Corp.: $7.6 million
William Doyle, CEO of Potash Corp. of Sask.: $3.6 million
Mayo Schmidt, CEO of Sask. Wheat Pool (Viterra): $3.3 million

It's like winning the Lotto 649 once or twice a year - every year.

For more on the Growing Gap and bloated CEO compensation - click here.


Robert S. Porter said...

So companies shouldn't be able to compensate CEO's how they feel?

Why is my business what private individuals sign in a contract?

What's the solution? Ban CEO's from making over 5 million? 3 million? 1 million? A percentage?

Richard_Cranium said...

Gerald Grandey, CEO of Cameco Corp.: $7.6 million
2006 Cameco revenue 1.832 BILLION DOLLARS

William Doyle, CEO of Potash Corp. of Sask.: $3.6 million
2006 PCS evenue 4.8 BILLION DOLLARS

Mayo Schmidt, CEO of Sask. Wheat Pool (Viterra): $3.3 million
2006 SWP revenue 1.6 BILLION DOLLARS

Again Larry, you were missing some valuable information. I am sure you knew the numbers, just chose not to publish them.
So you are telling us that you have a major problem with the heads of three corporations that generated 15.4 BILLION DOLLARS of revenue in 2006, are not worth 14.5million dollars. Dont know about you, but as a shareholder of two of the three, I would have my wallet out in a heartbeat if they wanted a raise....

Larry Hubich said...

There is no consistent application of the ratio of "gross revenue" to "executive compensation".

This fact is clearly illustrated in the compensation being paid to the three CEO's identified in the article.

I am a shareholder in all three companies. Some direct, some through holdings in "mutuals", and some through both.

I think the CEO's are already adequately compensated. In fact, I believe executive compensation is bordering on the obscene, and is clearly out-of-control.

A sentiment shared by a growing number of people from every political and ideological perspective imaginable.

Don't take my word for it - Google "excessive executive compensation" (in quotes) you may be surprised at who is saying what.

Richard_Cranium said...

When I see a baseball player sign 30 million dollar contracts, or a golfer winning many millions playing golf, these salaries, while I agree are more than I would earn in a lifetime, dont seem quite as high. I suppose they are either excessive or insufficient depending on your point of reference.

mooner said...

Larry.........what difference does it make to you what those fella's earn? How does what they take home affect you?

When a manager can turn earnings or profits in the billions and he is compensated in the millions, in terms of percentage, he is paid chicken feed.

Larry you, as head of the SFL, are paid according to the value you provide the organization, no different than the guys you are picking on. Maybe you could improve upon yourself to the point that you too could join the real world of business and earn in the millions!!

Oh would give 3/4's back wouldn't you?

Matthew Bennett said...

Holy shit.
Whats your salary like?!!
Will you only be happy when everyone makes equal amounts?
This is capitalism pal, get used to it.

David said...

If I shared your concerns about the CEO salaries (which I don't), I wouldn't be caught dead owning stock in these companies.

But that would be the principled thing to do...

Unknown said...

Gee Larry, if we locked in employees as a ratio of revenue produced, you'd be screaming ow unfair it is.

Larry Hubich said...

This is in response to a few of the points raised above.

In my years as a negotiator I have negotiated many different types of collective agreements and many different types of salary plans. For instance, I have negotiated salary plans based on total gross revenue generated; plans based on volume of commodity handled and/or sold; plans based on profit sharing and/or profit margins; and plans based on standard salary grid systems tied into well established job evaluation and job classification processes.

Each of them has their own particular positives, and negatives. Just a couple of examples:

Example 1: A plan based solely on volume of commodity handled, or sold, or gross revenue generated has created challenges for management. If the value of a product increases - so does the compensation level paid to the individual handling it. In the case of more advanced technology, better handling systems, etc. the actual work associated with the handling can decline, while the associated compensation increases. Apparently this is a problem in the eyes of many in management, -- attaching compensation to gross revenue, and/or gross handle. They argue, it may not always bear any relationship to the actual work performed - let alone whether or not the increased volume is resulting in increased profit.

Does the same principle apply to a CEO whose company's sales increase from - say $1 billion to $2 billion?

Example 2: A system based on profit margin, or profit when the control of the profit, or the setting of the price rests with someone other than the person being compensated on the basis of the generation of that profit. For example, an individual has their wage based on the profit generated from the sale of a product or commodity. Senior management decides that they are going to incur a loss by selling a product below cost for a period of time as a "lost leader". The person whose salary depends on that profit has no control over that decision - yet their salary is based on a profit that will never occur due to decisions made at a much higher level.

These are just two examples. You see the issue is much more complex than some would have you believe, and requires a more rational and mature discussion.

As for when compensation has reached the level of "being out of control" - you will likely remember that the NHL Owners took a year long strike when they insisted on a "salary-cap" for the players - like some of the other professional sports have. Coincidentally, you never hear them talking about a "salary-cap" for themselves though do you?

And for me, when it comes to millionaires fighting with billionaires - I'm going to side with the millionaires every time.

Keep smilin'!

David said...

If you think the owners of NHL teams are billionaires, you don't know much about hockey.

Don't get me wrong -- there are some owners who do it for fun.

Talk to the owners of the oilers, flames. Most don't earn as much as their players.

And it was a lockout -- not a strike.

Gary S said...

Wow! Lots of people sticking up for the rich dudes! Go guys! Don't let anyone tell ya that the employees do all the work. We know the world would come to a stop without all those captains of industry. You have to admire anyone who will go to bat for people who make more money in the time they use the men's room than the average employee makes in a month! I mean it's really great to see the downtrodden CEOs being defended so vigorously.