How Do You Fight CEO Severance Battles?
A Chief Executive Officer (CEO) of a public company is hired to turn a profit, thus making the shareholders money. A CEO’s departure is often anticipated when he is hired, a severance package is part a CEO employment contract. Severance packages for today’s CEOs are significant corporate expenditures. Shareholders have begun to rebel against huge severance packages by using the following methods to fight CEO severance battles. Evaluate a CEO’s employment contract. Look to see what the company is contractually bound to provide an exiting CEO. Examine the employment contract to determine if a “just cause” provision is included in the contract. CEO’s fired for just cause usually do not have the same rights as those fired without just cause. Contact the Board of Directors and notify them you want the just cause provisions of the CEO’s employment contract enforced. Illegal behavior is just cause for termination but performance based reasons for termination are more complex and can inspire l
