I Can Top That

    And here I thought the CEO of Goldman Sachs should take the annual award for being the biggest pig at the trough. Silly me. With a deep apology to Lloyd Blankfein, may I introduce you to Hank McKinnell, the former chief executive of Pfizer, who is going to get a nice gift of $200 million from the company's board. In a harsh column today by Gretchen Morgenson of The New York Times, we learn that:

Since Pfizer dumped Mr. McKinnell last July, we have been awaiting the details of his severance arrangement. We guessed it would be dizzying — his pension alone had been estimated at $83 million.

But after the company said late last Thursday that the terms of the package would soon emerge — on a day when shareholders, distracted by holiday shopping, might not notice — we knew the amount would be odious.

Here’s how Mr. McKinnell’s $200 million package adds up. First is his pension of about $6.65 million a year for as long as he lives. The company estimates its value at $82.3 million. Sweet.

Next comes $78 million in deferred compensation, which includes $67 million in pay that Mr. McKinnell has set aside over the years. Then there is an estimated $18.3 million in performance-based shares. Given Pfizer’s recent results, perhaps it would be more accurate if these were identified as failure-based shares.

Tack on $12 million in severance, vested stock grants worth $5.8 million and a $2.15 million bonus and Mr. McKinnell has all the makings of a very, merry Christmas. But that’s not all.

Mr. McKinnell, 63, also received $576,573 worth of medical, dental and life insurance as well as the unspecified value of continued medical and dental coverage under Pfizer’s retiree plans for him and his partner, Joanna Slonecka. Included in this pot is the cost of financial counseling programs. (Maybe he can dip into that amount to help line up some therapy for Pfizer’s board.)

The most curious figure of all, though, is $305,644 — rounded up to the nearest dollar, presumably — that represents the value of Mr. McKinnell’s unused vacation days.

    You would think this guy earned the money for doing such a great job for the company. Well, we know better:

Mr. McKinnell’s $200 million is even more disturbing when put next to the roughly $137 billion in market value that vaporized on his watch. That Mr. McKinnell forced his shareholders to pay $305,644 for his unused days off after draining them of $137 billion is downright stupefying.

But this is how too many leaders behave in 2006. They give large numbers of pink slips to employees. They create really big losses for their shareholders. But they make sure they chisel the company’s owners for every nickel and dime, including dental coverage, unused vacation days and financial counseling programs.