During the four years ending 2001, Bristol Myers Squibb paid its Chief Executive Officers more than $103 million, ranking thirty-eighth among US corporations. (Source: Business Week's Executive Compensation Survey)
In 2001, Bristol Myers Squibb's shareholders lost money, and the company announced that 2,295 hard-working employees would be laid-off (source: Forbes.com), yet each of the four executive officers who remained in the same job they held in 2000, received salary increases in 2001 and cash bonuses that averaged more than $500,000 in 2001. In 2001 Bristol Myers Squibb's stock lost more than 26% of its value, underperforming the company's self-defined peer group, which lost just 14%.
shareholders request that the Board conduct a comprehensive executive compensation review and publish a report of this review, omitting proprietary information and prepared at a reasonable cost. This report shall be available to all shareholders upon request by August 15, 2003. At a minimum, this review should consider the following:
Would shareholder value be enhanced if Bristol Myers Squibb altered its executive compensation policies to:
New York Federal Reserve President William McDonough had it right: executive pay packages are excessive and responsible companies should take actions to reform executive pay policies. Bristol Myers Squibb has not become a successful company by clinging to convention and refusing to change.
Does it take the promise of a financial payoff of tens of millions of dollars to get a CEO out of bed in the morning and off to work? Of course not. The passion of most successful CEOs is to create a company they and others can be proud of. We believe that a company with a commitment to fairness and equity, and in which all employees are regarded as co-creators of corporate success and where each shares in the sacrifice required during difficult times, would be a company worthy of pride.
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