May 4, 2015 Read More →

Arch Coal CEO Is Among the Best Paid in St. Louis, Even as Company Tanks

Arch Coal

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David Nicklaus of the St. Louis Post-Dispatch has a skeptical Sunday column that notes how CEO salaries “seem to go in only one direction: up.”

Nicklaus does a run-down of well-paid CEOs at St. Louis based companies, which include Arch Coal. He writes that corporations typically argue that gigantic compensation packages for top executives is the only way to keep qualified people around.

“When a company has a bad year, however, rhetoric about performance is sometimes played down,” Nicklaus writes, citing Arch as a prime example. Arch Coal stock was trading for just under one dollar at the close of business on Friday May 1 and has lost 80% of its value since May 2014.

Excerpts:

  • “Arch Coal raised CEO John Eaves’ salary by 15 percent and handed him total compensation of $7 million even as it was losing money. The company said it needed to offer competitive pay ‘to attract and retain executive talents.’”
  • “Eric Marquardt, a Clayton-based consultant with Pay Governance, says Arch’s argument is a common one. ‘The company’s explanation is, “We might need to keep these people around if we are going to be successful in a turnaround,” he said.’”

Full article.

(In a related item last week, IEEFA’s David Schlissel wrote about St. Louis-based Peabody Energy under the headline “Those Executive ‘Pay Cuts’ at Peabody Energy? Mstly a Charade”).

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