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Credit C.E.O. Comp Under Fire, III
Now the main show gets under way at the Housing hearing on the compensation of the C.E.O. of Countrywide Financial and the former chiefs of Merrill Lynch and Citigroup.
Elizabeth Olson is blogging live from the hearing:
Charles Prince, who was forced out of Citigroup in November with a $68 million exit package, starts by speaking about his long history with the bank, and says that the Citi's board "instituted processes designed to ensure fair executive compensation."
"Some have raised questions about my compensation, and much of the information reported in the media is incomplete or inaccurate. I therefore welcome the opportunity to provide the committee with complete information," Prince says.
Richard D. Parsons, the former C.E.O. of Time Warner, speaks next, appearing as a member of Citi's board and chairman of its compensation committee. "Executive compensation levels, particularly in the financial services industry, are driven by a highly competitive market to attract and retain talent. The competition for talent is especially important for a company with the scale and scope of Citi -- a leading global financial services company competing, serving customers, and conducting business in more than 100 countries. A compensation approach that allows Citi to attract and retain the top financial services industry talent around the world is a core responsibility of the compensation committee."
He said the "good corporate governance requires that public companies be as transparent as we can about the processes we use to determine executive compensation. We strive to make the descriptions of our compensation philosophy and process contained in our public filings clear, detailed and thorough."
"By tying compensation to performance, Citi aims to attract and retain the best talent and to align the interests of senior executives with the interest of stockholders."
Benchmarking for Citi executives, he said, "is difficult because the combination of lines of business at Citi is not precisely replicated at any other company."
But for comparison, he said they looked at Bank of America, Deutsche Bank, General Electric, and Goldman Sachs among others. Also, Citi also considers "factors contributing to the financial performance of Citigroup over time and the individual leadership of senior executives."
Elizabeth Olson
