Tenet Ex-Director Lashes Out on CEO Pay

The proxy "contained compensation information that, we believe, begs the question: What is management being compensated for?" Shove noted. "Despite the cash flow crunch and destruction of shareholder value, Tenet's board of directors has been amazingly generous."

Now, however, Nakasone is apparently having second thoughts about the compensation policy he voted to approve. Nakasone's comments to the Journal also indicate that he differed with the board on two other crucial matters. He suggested that he might have been receptive to a merger that could have altered Tenet's plans to sell many of its hospitals. And he apparently favored hiring an outsider as the company's permanent CEO.

Interestingly, Nakasone was one of just three members on the ad hoc committees established to review Tenet's assets and recommend its next CEO. Kangas, who is now criticizing Nakasone, sat on those same committees.

As directors, both men were entitled to $65,000 in base pay annually. They also picked up $1,500 per board meeting and $1,200 per committee meeting. In addition, they collected a flat fee of $15,000 each for selecting Tenet's current CEO. And Kangas scored an extra $50,000 for serving as the company's nonexecutive chairman.