Interesting parallel drawn in today's Times DealBook about how the some leaders in the manufacturing world are treating the bonus dilemma, and how it contrasts with the lack of leadership shown by the financial sector's executive layer.
According to the story, G.E. CEO Jeff Immelt wanted "to get ahead of things by forgoing the $12 million bonus that was coming to him."
Such a common-sense move paid PR dividends for G.E. (this post included), and appears to be setting a trend at other marquee manufacturers, says DealBook's Flack:
The business press generally followed G.E.'s cues. The headlines were generally favorable to G.E., with most stating some version of "G.E. C.E.O. to Forgo Bonus." The tone of the coverage was straight-forward, with few third-party plaudits and only minimal skepticism.
But is Mr. Immelt's decision the beginning of a coming trend? Later that same day, for instance, Hewlett-Packard said its chief executive, Mark Hurd, would cut his salary by 20 percent, given the company's disappointing results. Mr. Immelt and Mr. Hurd are cowbell names, and their stories have undoubtedly caught the attention of nervous compensation committees everywhere.
But will there be enough of an early critical mass of bonus abstainers to make those who don't follow suit stand out as greedy exceptions?
Hopefully shame works where common sense obviously did not.