William Stavropoulos, outgoing CEO of Dow Chemical, last year took $2.2 million in bonuses, which works out at $6027.40 a day. His total pay was more than $7 million, or $19,178 a day.
His company’s victims must survive on compensation that, over 20 years, works out at 7 cents a day.
Is Stavropoulos’s life worth 273,972 times more than a Bhopali’s?
DOW EXECUTIVES REWARDED
Pay is directly related to performance for those at the executive level of management at The Dow Chemical Co., and in 2004, meeting and exceeding goals meant rewards.
Along with salaries and stock awards, the top six positions at the company were given between a half million and $2.2 million bonuses for their performance. Bill Stavropoulos, who served 10 months of the year as Chief Executive Officer, received the most – $2.2 million, bringing his total annual compensation to more than $7 million. Andrew Liveris, who took over the helm in November, received $1.55 million in bonus pay, bringing his earnings to $3.6 million.
“As Dow’s (financial) results improve, our compensation is aligned to reward those employees,” said Greg Comeaux, global director of compensation and benefits. “Our compensation is reflective of the type of year we had.”
For a second year running, the company’s action plan has lifted earnings and profits while cutting costs and reducing debt. In 2004, despite continued pressure from feedstock and energy costs, Dow achieved a drastic increase in overall per-share earnings – $2.93 compared with $1.87 in 2003. It produced record-breaking sales of 40.2 billion, reduced debt by 9 percent and expanded profit margins by $2 billion. Net income was $2.8 billion, exceeding the $1.73 billion in 2003 and towering above the $338 million loss of 2003.
Dow’s independent compensation committee took those numbers into consideration when deciding this year’s salaries and bonuses. The goal is to set executive compensation around the median level of companies with which Dow competes for executive talent. Some of the 18 benchmarkers include General Motors, IBM and 3M.
About 75 percent of executive pay is tied directly to performance. In 2003, the senior executive group was denied both bonus pay and stock awards when net profit lagged below the minimum performance goal of $700 million.
Reporter Kathie Marchlewski can be reached at Kathie@mdn.net or 839-4233.