October 31, 2011; Source: Wall Street Journal | It is the irony of the times. Just as the Occupy Wall Street movement continues and deepens its attack on the concentration of wealth in the U.S., the Wall Street Journal reports on one of the wealthiest corporate severance payouts in many years. Nabors Industries (an oil drilling company) is rewarding its chairman and CEO, 81-year-old Eugene Isenberg, with a $100 million cash severance for giving up the CEO title, although he remains chairman of the company (and will continue to earn a not too shabby salary for that modest job). Note that the original severance deal was for $264 million until shareholders objected.

This isn’t compensation for Isenberg’s having been underpaid over the years. TheJournal cites one source that puts Isenberg’s total compensation for 1999 to 2009 at $518 million. Another source cited by theJournal ranked Isenberg “one of the previous year’s five highest-paid, worst-performing U.S. executives,” because of the lousy performance of Nabors Industries against the S&P 500—or maybe because in 2010, within his total compensation of $13.537 million, he pulled down a bonus of $9.734 million that some might have considered unwarranted.

Put the severance payout in perspective. The $100 million for Isenberg is more than the entire company’s third quarter net income of $74.3 million. The highest paid corporate executive in the U.S. last year was Phillippe Daumon, of Viacom, who earned only $84.3 million—and even that was just $13.9 million in cash, with the rest in one-time stock and options awards, compared to the all-cash payout to Isenberg. As a severance payout, it is larger than the $65.7 million that Sanjay Jha will get if he leaves Motorola Mobility Holdings after its pending acquisition by Google.

Here’s another perspective: the philanthropic lens. Compare the severance (or the severance plus Isenberg’s astronomical compensation levels) to the philanthropic output of the Isenberg Family Charitable Trust and the Nabors Charitable Foundation.

Year

Isenberg Family Charitable Trust grants payout

Nabors Charitable Foundation grants payout

2010

n.a.

$318,824

2009

$1,342,653

0

2008

$1,012,231

$14,000

2007

$1,306,786

0

2006

$3,525,023

$118,530

2005

$2,033,914

$33,000

2004

$791,758

n.a.

 

The corporate grantmaking appears to be primarily disaster relief assistance for Nabors employees (probably hit by the many passing hurricanes in the Gulf) and scholarships for the children of Nabors employees through the Isenberg Educational Fund. The family grantmaking is big on high-profile institutions of particular interest to Isenberg—the University of Massachusetts at Amherst (where he graduated, and where the school of management is named after him), the Martha’s Vineyard Hospital ($600,000 between 2007 and 2009—Isenberg has a home in the Vineyard), the Palm Beach Opera (more than $500,000 since 2003—Isenberg has a home in Palm Beach), the Houston Grand Opera (where the firm is located), and the Parkside School (at least $750,000 from 2007 to 2009 for this Upper West Side private school for children with language-related learning disabilities).

Isenberg is philanthropically generous to lots of causes, even some politically progressive groups ($125,000 total in three grants since 2004 to Human Rights Watch and an odd $1,420 grant to the Jewish Funds for Justice in 2004), and the operas, hospitals, and schools are undoubtedly grateful for Isenberg’s charitable largesse. But his and the corporation’s philanthropy pale next to the size of his multiyear compensation and one-year semi-severance payout. Is this the kind of unchecked self-indulgence of the 1% that the Occupy crowd decries?—Rick Cohen