The buck doesn't stop here

Only in America. The profits might be down but the pay is up. The US generally claims to have the best corporate governance practices anywhere but there are some glaring exceptions, especially in the area of chief executives' employment contracts.

Take the package enjoyed by Jerry Sanders, founder and CEO of Advanced Micro Devices. Although AMD has consistently disappointed shareholders, Sanders' 33-page contract obligates the company, among other wondrous provisions, to repay up to $US3.5 million that he may borrow for whatever reason. He is also guaranteed a performance bonus after he is dead, which shows unusual faith in his abilities.

And at Warnaco, the apparel-maker whose brands include Calvin Klein and Speedo, chief executive Linda Wacher received a $US6 million bonus on top of her $2.7 million base salary this year. She also received $US6.5 million in restricted stock. Obviously, she did well? No, she did badly. Warnaco's stock has collapsed since 1998 and last year the company lost money.

* Peter Beck, former Archdeacon of Auckland, is a career management consultant with DBM New Zealand, not a recruitment consultant as described on this page on April 19.

* Selwyn Parker can be contacted by e-mail at at wordz@xtra.co.nz Regrettably, he is not able to answer personal letters.