Finish the Job: AFL-CIO Calls on Pfizer to Send Hank McKinnell Packing

[Omaha Steve]

http://blog.aflcio.org/2006/08/17/finish-the-job-afl-cio-calls-on-pfizer-to-send-hank-mckinnell-packing/

Corporate Greed

Aug 17

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Finish the Job: AFL-CIO Calls on Pfizer to Send Hank McKinnell Packing

Pfizer Exec Hank McKinnell got booted out as corporate CEO. Daniel Pedrotty from the AFL-CIO Office of Investment explains why Pfizer should finish the job and remove McKinnell as board chairman.

There’s no better example of a corporate board “paying for failure” than Pfizer and former CEO Hank McKinnell. During McKinnell’s tenure, which ended abruptly two weeks ago, Pfizer’s stock was down by almost half, and the giant pharmaceutical corporation lost more than $50 billion in market value. Despite this disastrous track record, McKinnell received a retirement package valued at $83 million—a cool $6.5 million a year.

Thankfully, Pfizer’s board finally worked up the courage to oust McKinnell as CEO. The protest led by the AFL-CIO over McKinnell’s outrageous pay package at the company’s annual meeting in April led in part to his downfall.

McKinnell is a good example of a member of the out-of-touch corporate class who thinks traditional, secure pensions are too expensive for everyone except themselves. To add to the hypocrisy, McKinnell was an outspoken advocate of the Bush administration’s Social Security privatization scheme. Apparently, 99 percent of U.S. workers should be forced to gamble their retirement savings on the stock market while Pfizer shareholders foot the bill for McKinnell’s $83 million guaranteed golden pension.

This week, the AFL-CIO delivered a letter to Pfizer’s Corporate Governance Committee calling on Pfizer to finish the job and remove McKinnell as board chairman. With serious legal and regulatory challenges facing the company, along with a new CEO who has limited pharmaceutical industry experience, the time is right for the company to elevate an independent director as chairman. Much like AIG’s clean break with CEO and Chairman Hank Greenberg last year, Pfizer’s board needs new blood and decisive, independent leadership.

While the board, the shareholders’ representative, has taken encouraging steps, the corporate governance community awaits their “clean break” with McKinnell’s legacy of divisiveness and failure.