Should looting a sinking ship illegal?

[Anonymous No.180937]

http://www.bloomberg.com/news/2014-03-05/radioshack-to-pay-ceo-500-000-retention-bonus-as-sales-plunge.html

>Chief Executive Officer Joe Magnacca will get a $500,000 payment, while other executives will receive $187,500 to $275,000, the Fort Worth, Texas-based company said today in a filing. Magnacca also will be eligible for a bonus of as much as $600,000 next year if he meets performance targets.

Meet targets, earn bonus.

[Anonymous No.180944]

>>180937
Whoa, whoa, whoa. You mean that of people exceed expectations they get rewarded? Crazy talk.

[iHaz !MILLiOnz/Q No.181252]

>>180937
The retention of competent executives is a huge priority for a distressed business. If your key people leave, then there goes any prospect for reorganization. The business will wither and liquidate, and everyone will lose their jobs. If the talented executives stick around, there's at least a chance the company can turn it around, or sell itself as a going concern.

The company's executives aren't always at blame for the problems that lead to bankruptcy or insolvency. Often the bad decisions were made by prior management, and the current ream simply inherited their mess.

I'm not a big fan of "pay to stay" programs (where the executives get paid merely for agreeing to stick around). I do think that incentive based compensation is a must, however. Smart people get incentive bonuses in healthy companies -- to think they should not get them in distressed companies is just ignorant.

[Anonymous No.181409]

>>181252
in principle this is true, but didn't we have a problem in the 80s with companies that had huge boards who got huge compensation but did very little

how are the shareholders supposed to get accountability for their CEOs to make sure they really are getting what they pay for?

[Anonymous No.181461]

>>181409
By insisting on performance targets and votes of no confidence on management that does a shit job.

I'm not familiar enough with Radioshack, but odds are sales are plunging because the economy sucks and newegg stole their market. I still go there from time to time but they're over priced and understocked, usually. Newegg or Fry's has what I want more often, and cheaper.

[iHaz !MILLiOnz/Q No.181511]

>>181409
The law has changed on executive compensation, as has the general expectations. There are very few (if any) "fat cat" programs left from the bad old days. Boards know that they open themselves up to liability if they reward incompetence. Frankly, banks know it too, and they're just as active in controlling executive compensation as anyone.

[Anonymous No.181578]

>>181461
>but odds are sales are plunging because the economy sucks and newegg stole their market
Also because radioshack itself is shit.
It's one of those stores that I don't think anybody actually likes.

[Anonymous No.181627]

>>181578
It used to be a half decent hole in the wall place for hobbyists and specialty electronics. Now they've spent the last decade plus as a hole in the wall cell phone store. They have no customer base to build back up.

But that's a dumb compensation package. They would be better off liquidating and cutting their losses. I have no confidence after that joke of a superbowl commercial. They spent millions on what in hindsight is an homage to 80's corporate raiders.

[Anonymous No.181760]

500k actually isn't a lot relatively speaking

[Anonymous No.181795]

I worked for this company when I was an intern consultant. Corporate office has seafood and fancy lunches with hot receptionists. The warehouse is laying off 1-5 people a week. And they ask us what is wrong with their finances.

[Anonymous No.181796]

>>181627

winner of the thread is right here

I should have took a short position as soon as I saw that dumb commercial. The stock spiked up because of a fucking commercial. Sounded more like a final pump and dump before RSH goes bellyup

[Anonymous No.184088]

>>180944
>Implying anyone working at Radioshack is exceeding expectations
Well I guess if you redefined the word "expectations" and set them lower, then everyone deserves a bonus. That's how crown corporations operate in my country anyways.