By now, you've heard the sad story of Bob Nardelli, the CEO of Home Depot who resigned on Wednesday. His severance package will yield him $210,000,000.
Please remember, his board of directors had to approve this package. Also keep in mind that the amount of revenue and profit this business generates is beyond staggering. In the last fiscal year, Home Depot generated nearly $82,000,000,000 (that's eighty-two billion) net sales, and $9,300,000,000 in pre-tax profit. Yes, that's right, 9.3 billion, pre-tax.
A severance package of $210,000,000 barely registers against $9.3 billion in pre-tax profit. Only mega-companies can offer mega-compensation.
If you are wondering how this hurts the 380,000 employees who made all of this possible, here's how. Take $210,000,000 / 380,000 = $552. Ultimately, each employee contributed $552 to Mr. Nardelli's good fortune. A half-time employee making $12 an hour sacrifices just shy of five percent of her salary supporting CEO severance.
There's only one way to stop this, folks. Stop shopping at Home Depot. As long as we keep shopping at mega-stores, mega-profits will drive mega-severance packages. We are part of the problem.
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