AT&T Inc., Hewlett-Packard Co. and Safeway Inc. are among the nearly dozen companies that rewarded executives for long-term underperformance, says a new study that highlights what it calls the broken link between pay and results.
Chief executives at 11 companies studied by the Corporate Library, an independent group that monitors corporate governance, received $865 million over five years while presiding over a loss of $640 million in shareholder value. The study chose companies from the Standard & Poor's 500 index whose returns lagged their peer group and ranked among the highest payers.
Others listed in the study were BellSouth Corp., Home Depot Inc., Lucent Technologies Inc., Merck & Co., Time Warner Inc., Pfizer Inc., Verizon Communications Inc. and Wal-Mart Stores Inc.
"The link between long-term value growth and long-term incentive awards is broken at too many companies, if it was ever forged properly in the first place," Paul Hodgson, one of the study's authors, said Friday.
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