Hayward's 'Golden Parachute' Is Relatively Modest Tony Hayward is out as CEO of BP after the company's disastrous oil spill. If he leaves the company, he stands to walk away with a compensation package that includes about $1.5 million in salary and a pension worth $17 million. That will seem like an unforgivable sum to many people. But as "golden parachutes" go, his deal is actually quite modest.
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Hayward's 'Golden Parachute' Is Relatively Modest

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Hayward's 'Golden Parachute' Is Relatively Modest

Hayward's 'Golden Parachute' Is Relatively Modest

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ROBERT SIEGEL, Host:

From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel.

MICHELE NORRIS, Host:

While departing chief executives in the U.S. often end up with extravagant golden parachutes, NPR's John Ydstie reports that doesn't seem to be the case for Tony Hayward.

JOHN YDSTIE: In the U.S., CEOs exiting large companies, even those leaving under a cloud, can usually look forward to a soft landing.

NORRIS: We've seen some pretty spectacular golden parachutes paid out over the last four or five years.

YDSTIE: That's Paul Hodgson, senior research associate at the Corporate Library. It specializes in executive compensation and corporate governance issues.

NORRIS: Certainly, one of the highest was to Robert Nardelli when he left Home Depot. That was valued by us at around $120 million.

YDSTIE: And that was after five years of underperformance at Home Depot. Exit packages averaging around $40 million are pretty standard in the U.S., says Hodgson. Now, contrast that with what Tony Hayward could get.

NORRIS: His severance would amount to around a year's salary, which translates into between $1.5 and $1.6 million.

YDSTIE: Paul Hodgson says there didn't used to be this vast difference between practices in the U.S. and the U.K.

NORRIS: In the mid '90s, when the corporate governance revolution started in the U.K., that golden parachute was one of the main targets of the code writers.

YDSTIE: The Corporate Library's Paul Hodgson says the newly minted financial overhaul law in the U.S. could narrow the difference between U.K. and U.S. exit packages.

NORRIS: Part of the Dodd-Frank Act that's just been signed into law indicates that golden parachutes must now be put to shareholder votes.

YDSTIE: John Ydstie, NPR News, Washington.

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