As our financial behemoths melt down, and the government swoops in with huge bailouts, we need to see some reasonable parameters put in place. Tom Evslin's set of rules for brokerages, banks and insurance companies make a ton of sense to me (thank you Fred Wilson for the link) -
Rule #1: Cut salaries now
Part of the bailout bill ought to be that any organization which proffers securities for government purchase must agree not to pay any employee or contactor more than $1 million per year for the next four years. No cheating with trips to events on the corporate jet or other perks with draconian penalties TO THE RECIPIENT for violations.
Rule #2: No new golden parachutes
Some executives have contracts which entitle them to huge golden parachutes – especially if their pay is cut. These need to be annulled.
Rule #3: End payment on old golden parachutes
Payments on existing golden parachutes should be stopped.
Rule #4: No dividends for a year
This seems harsh to us shareholders who may have bank securities in our portfolio, but it's not. Clearly an organization which is being bailed out needs to conserve cash to survive.
Smart, right? Drop a line to your Congressman or Senator letting them know your thoughts on this. They're making these decisions right now and hearing from us can make a BIG difference.