"Exxon CEO Defends Predecessor’s $400 Million Retirement Package"
This morning on NBC’s Today Show, ExxonMobil CEO Rex Tillerson said he “understand[s]” consumers’ frustration with high gas prices and the news that Lee Raymond, Exxon’s former CEO, received a $400 million compensation package. But he noted that Raymond’s high retirement package wasn’t Exxon’s fault — it was determined by an independent group. Watch it:
TILLERSON: I do understand that [consumer frustration]. It has created a real distraction, I think, in the high price environment to dealing with the fundamental issues of why we have high prices. That compensation is determined by a committee of independent directors of the corporation who are responsible to the shareholders and the management have no input to those packages.
Exxon’s compensation board isn’t as “independent” as Tillerson suggested. In 1999, Raymond was on the board of Chase Manhattan. When CEO Walter Shipley retired, Raymond and other board members awarded him a multimillion-dollar compensation package. Shipley now sits on Exxon’s board and helped award Raymond his generous reitrement package.
Additionally, Raymond helped choose his five-person compensation board. Exxon’s compensation board is “appointed by the Board [of Directors] from among its members.” The chairman of the Board of Directors? The Exxon CEO (Lee Raymond).
Full transcript below:
LAUER: Perhaps the poster child for all of this — especially in the public relations side of this — was the former CEO of ExxonMobil Lee Raymond, who left the company I think about a year ago. And according to The New York Times in his final year was paid something in the neighborhood of $400 million. Is that an appropriate amount?
TILLERSON: It’s a large amount of money. There’s no question about it. It comes at a time with these high prices where obviously it has drawn a lot of attention. I would say that number has been talked about in a number of different ways and involves a lot of deferred compensation which is still out in the future, yet to be given to him.
LAUER: But you understand when a family pulls up to the pump and they see 60 cents more this month and the headline “$400-million Pay Package,” that rankles them?
TILLERSON: I do understand that. It has created a real distraction, I think, in the high price environment to dealing with the fundamental issues of why we have high prices. That compensation is determined by a committee of independent directors of the corporation who are responsible to the shareholders and the management have no input to those packages.