Compensation Goodies

The Corporate Library found that of the 280 largest companies that have reported so far, two-thirds of CEOs have investments in NQCD plans. The average balance in such plans is more than $5 million.

Among the largest deferred comp plans reported so far: US Bankcorp(USB Quote) CEO Jerry Grundhofer has amassed more than $86 million, while Alexander Cutler, CEO of Eaton Corp. (ETN Quote) and William Weldon, CEO of Johnson & Johnson(JNJ Quote) each have more than $40 million in these plans.

Wonders Bennett: "If they're aggregating such large sums in these accounts, do they really need additional retirement benefits?"

Reporting Executive "Perks"

Another big issue that is coming to light as a result of new reporting requirements: the value of executive perks. In a sample of 100 companies that had filed as of March 12, 2007, the total disclosed cost of perks was more than 130% higher than the reported amounts the previous year, according to The Corporate Library.

Some CEOs received significantly more in perks in 2006 than in 2005, according to the study. The largest increase was at Merck(MRK Quote), where last year's filings (for 2005) showed the CEO receiving only $9,450 in perks. By 2006, he received aircraft benefits, commuting benefits, security alarm monitoring benefits, dividend equivalents, and a company match to the savings plan of $210,536 -- a 2100% increase.

Thomas May, CEO of NSTAR(NST Quote), an energy delivery company in Massachusetts, received 40l(k) contributions, financial planning, company leased vehicles, home security, tickets to sporting events, a life insurance benefit, plus a tax gross-up of that income in 2006, according to the new compensation disclosures. The previous year only the savings plan and life insurance were reported.

Asks Bennett: "Are these new benefits, or just newly reported? He answers his own question: "The better disclosure standards demanded by the SEC are scaring companies into being much more meticulous about reporting compensation practices."

You can learn more at www.TheCorporateLibrary.com. Or, starting in June, you can go to www.SEC.gov to not only see, but compare the data that companies are now reporting on executive compensation. Given the enthusiasm for this kind of disclosure, it's likely that next year they'll post even more data, including director compensation and benefits. More disclosure is truly a "perk" for shareholders. And that's The Savage Truth.