A contest….

March 15, 2004

Now that Jeffrey Greenberg has officially resigned as Chairman and CEO of Marsh & McLennan (MMC), it will be interesting to see how much money he winds up walking away with. So let’s have a little contest: the person who comes closest to guessing the correct package will receive a signed copy of my book, Financial Fine Print. Greenberg’s resignation came only two weeks after Eliot Spitzer annouced a massive investigation and possible criminal charges. But that hasn’t stopped other top execs from walking away with lavish parting gifts. One key difference is that Greenberg doesn’t have an employment contract, so he’s unlikely to walk away with the typical three years of salary and bonus, plus other goodies that most deposed CEOs wind up with. But it’s a safe bet that he won’t be walking away empty handed. According to Marsh’s most recent proxy, Greenberg, whose base salary was $1.2 million last year and whose bonus was $3.5 million, received 21,000 shares of restricted stock and 500,000 stock options in 2003. The restricted shares had a 10 year vesting period and the options had a 10-year window. So send your best guess on Greenberg’s parting package to me at ml@footnoted.org. Once the company discloses the package, I’ll announce a winner and send out the book.

CLARIFICATION: A number of people have written in asking about options and how to count them. I’m looking for total cash compensation. If the options and restricted shares are accelerated under the agreement, I’ll count those as cash. Otherwise, they count as options. As for other potential perks, such as health insurance, office space, country club dues, I won’t attach a cash value to them, but they should be part of your guesstimate. Keep those guesses coming!

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