Blackberry CEO set to Deploy the Golden Parachute
As Blackberry stock plummets CEO Thorsten Heins is prepped for a soft landing.
By Konstantine Roccas, Staff Writer
In yet another ‘crowning’ moment for modern corporatism, Blackberry CEO Thorsten Heins is set to earn a severance package of 55 million dollars if Blackberry is sold and he is ousted.
The struggling cell-phone developer has been making headlines as of late with the underperforming sales of their Z10 and Q10 line of phones. Following the launch of those phones, the stock took a nosedive from a launch day high of 17.90 a share in late January 2013 to 13.30 by the end of February.
In the wake of these disappointing results, rumours have sprung up about a possible sale, privatization or a transition to software production from hardware. Over the past week this has lead to a small rise in share prices. The reasoning being that if the company is sold or privatized shareholders will be bought out and make a pretty penny for their ‘efforts.’
Of course, in accordance with the mind-boggling world of business and finance, the CEO who led the company down into the abyss now has a golden incentive for selling the company. As a reward for his ‘sterling’ performance in cutting 5000 jobs, eliminating six manufacturing plants and leaving the once proud Canadian developer in ruins and on the verge of a buy-out, Thorsten Heins is set to sail into the sunset with a cool $55 million.
In the midst of an economic downturn, it is positively shocking that there exist pay-packages and golden parachutes for these ‘captains’ of industry. In any other industry we are judged based on performance. If somebody who works at a restaurant is fired for poor attitude and deficient work performance, he is unceremoniously ousted. Yet in the world of big business and finance, men and woman are able to turn in poor performances, impoverish and oust their work force, and get rewarded with enough money to buy a small island.
“The apparent $55 million severance package for the Blackberry CEO is another example of the now out-of-control self-enrichment of top executives throughout the world of large capitalist enterprises,” says crisis economist Professor Richard Wolff. “This anti-social behaviour not only contributed to the global crisis since 2007; it now also uses that crisis to increase exploitation.”
To add insult to injury, in times of crisis, government, banks and corporations ask the ‘little’ guy to tighten his belt and make sacrifices. While normal families are finding it difficult to get by, failed executives are still having the time of their lives. In the case of Blackberry, the Canadian government has also subsidized a loan for another company to buy Blackberry’s products.
Of course the board of directors crafted this marvellous package which is available to Heins if and only if the company is sold. This creates an incentive for Heins to explore offers to sell the company. If the company is not sold and he is released he will only make a paltry $22 million. “The onus of structuring that contract was on the board,” says Sameet Kanade, an analyst at Jacobs Securities in Toronto.
Regardless, the outlook is grim for Blackberry and by extension Canadian engineering and innovation. The parachutes are burning except for that of Thorsten Heins. He’s laughing all the way down.
Image provided by yeahyeahright.blogspot
Konstantine Roccas is an observer of local and international affairs and governance, but also writes about anything else that piques his ire.