Bonuses for Cheniere Executives Should be Linked to Profits

There is something a little disquieting about the justification for paying Cheniere Energy’s employees another $2 billion worth of stock bonuses.

I’m sure they are good people who work hard for their pay. But they’ve already received $1.7 billion in stock bonuses, which last year made Charif Souki the highest-paid CEO in the United States, according to the Associated Press, even though his 18-year-old company has yet to post an annual profit.

The argument that shareholders need to dilute their stock further in order to sufficiently incentivize employees to deliver a profit challenges common sense.

Rather than take a parachute that pays them for constructing potential white elephants and driving up the stock price, stockholders would be better served by tying bonuses to future profits.
June 21, 2014
Houston Chronicle