When you think about it, $71.8 million in total compensation just isn’t what it used to be. That’s what Abercrombie & Fitch Chairman and CEO Mike Jeffries raked in for 2008. Meanwhile, the company he was skippering showed a profit of $254,000. Basically, A&F as a company – with all the resources available to it – earned the decent salary of a lower-level executive. So, it’s no surprise that Jeffries had his wings clipped.
According to the Corporate Library, a watchdog group, Jeffries was one of the top five Highest Paid Worst Performers of 2008. Translation: never has one received so much for accomplishing so little. I don’t know if you can call it punishment – hell, it doesn’t even feel like a reality check- but A&F is putting the brakes on its contributions to the CEO’s personal travel cost. After $200,000, he has to pick up his own tab. Compare that to the 2008 personal travel bill he turned over to shareholders: $1.3 million.
Yeah, times have changed.
Now, I’m sure someone, somewhere, is about to shed a tear for Jeffries. After all, he’s losing a nice perk. Fortunately, he has found a way to compensate (well, be compensated) for the change in travel policy: A&F is kicking in a $4 million lump-sum payment.
I know it’s fashionable to hate greedy CEOs. Frankly, I’m fine with their making obscene amounts of money, as long as they’re creating kick-ass amounts of shareholder value – that’s really all that matters. Well, Jeffries hasn’t been delivering the goods, which means just about anything is “generous” at this point.
If it had to happen, at least, the cap on personal travel expenses came at the right time. Flights are still pretty cheap, and hotel rates aren’t likely to start recovering until next year.