Who needs Nostradamus when you have CNN’s “American Morning"? Instead of waiting for someone to complain about a big executive payday, the April 9 show’s team whined about its own pay and predicted the AFL-CIO would chime in on their side.
The issue was the salary and other compensation for Occidental Petroleum Corp. (NYSE: [1]OXY) CEO Ray Irani, who received $400 million in 2006. Even before the AFL-CIO had gone on record about the number, CNN’s morning team brought up that possibility and predicted the result. “So, yes, this is an issue and we'll have to see if the AFL-CIO goes after Occidental Petroleum next,” commented “Mind Your Business” newsman Andrew Ross Sorkin, visiting from his New York Times job.
Anchor Soledad O’Brien, who had earlier complained she was “desperately” underpaid, answered for Sorkin. “You think with a number like that they will. I’ve got to imagine,” she said.
Sorkin called Irani’s 2006 pay “what has to be one of the largest numbers in history” and linked it to several other high-profile CEO payouts, including ones at Pfizer and Home Depot. However, even Sorkin admitted it was a payout that took years to earn. “Just to be fair, this is money that has accumulated over the past several years. Had he not taken all these options he would have made just a paltry $55 million,” he told viewers.
Anchor Miles O’Brien responded with a sarcastic “Hard to get by on that.”
The April 7 Los Angeles Times gave a more fair and detailed view of Irani’s pay, which included “cashing in more than 7 million shares from stock options that were awarded back to 1997.” In addition, the company had to “discontinue a deferred stock program in October 2006 because the liability and expense of the program had ‘grown substantially.’” That resulted in another $93.3 million.
While that still resulted in a hefty “$55.6 million in salary, bonus, stock awards, deferred compensation and other benefits,” it also reflects how well the company has done under his leadership.
According to the Times, Occidental’s stock price went from $9 at the end of 1990 to nearly $50 now – a more than 450-percent increase. CNN’s visiting reporter Sorkin downplayed that huge growth, saying: “The company has done well, to be fair.” Then he quickly turned that performance into a union issue. “But, obviously, CEO exec competition is so under pressure today and the AFL-CIO, which is one of the big union groups, has come out against Verizon in the recent days,” he explained.