Oracle now paying Ellison $1 a year
Oracle co-founder Larry Ellison has been one of the country’s highest paid CEOs for many years, but has decided that in light of the poor economy, he would reduce his compensation to one dollar per year.
Even at that much reduced rate, Ellison probably will not be missing any meals. Ellison’s compensation package for last year was estimated to be worth approximately $69 million a year, in work done by a well-known compensation analyst, behind only only Aubrey McClendon of Chesapeake Energy Corp., and Motorola Inc. co-CEO Sanjay Jha. That is getting into very rarified circles. In addition, Ellison is estimated to be the fourth wealthiest person in the world by Fortune Magazine, according to a Bloomberg story. Not bad for a person making so little, and his sacrifice probably will not cut into his net worth.
Ellison, of course, agreed to the cut in pay, which was documented in a regulatory document which Oracle filed Friday. In that filing, Oracle said:
The compensation committee recognizes that Mr. Ellison has a significant equity interest in Oracle, but believes he should still receive annual compensation because Mr. Ellison plays an active and vital role in our operations, strategy and growth. Nevertheless, during fiscal 2010, Mr. Ellison agreed to decrease his annual salary to $1.
The paycut is for the fiscal year 2010, which for Oracle started in June. For fiscal year 2009, Ellison’s salary broke down as follows: $3.6 million in bonuses, $1.7 million in other compensation and $62.9 million in stock-option grants. Although that sounds like a great deal of money, Ellison’s net worth is based primarily on his ownership of 23 percent of Oracle stock, plus other investments. The Oracle stock, at today’s prices is worth more than $25 billion. That means that his salary is less than 3 tenths of 1 percent of his net worth. Almost pocket change, really.
Still, one supposes that it is a good example. Oracle will not make much money in 2010, in all likelihood, and it is good public relations, if nothing else, to at least show the folks in the trenches that you are not draining the corporate coffers in bad financial times. It’s a tactic that any number of other CEO’s could have used to advantage in the recent economic downturn.
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August 23rd, 2009
Its nothing but smoke and mirrors BS. Done purely for the PR.
November 26th, 2010
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January 21st, 2011
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