Question

All three of the CEOs in the case were given large severance packages. What message does this send to future CEOs of these companies? If you were on the board of directors, would you endorse such severance packages? What is the cost of not granting a competitive severance package?

Answer 1

The severance packages is well deserving for these CEO’s and should not bemisinterpreted in any way. I believe that though they were guilty of misbehaviour, these officials did notexactly break any rules. Therefore the companies would have a lawsuit to battlewith probably which could get messy and create very bad image for thecompany at large if not handled properly. These officials also worked really hardand achieve amazing things for their respective companies and that should beconsidered when evaluating the value of the packages.

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