"Finally, the CEO/chairman does not set his own pay. It is instead determined by the Compensation Committee, which is also composed entirely of independent board members." (See article here in Insider Monkey)
Just what "independent" means is at risk of being stretched beyond the truth. Take James A. Johnson, of Goldman Sachs, who is chairman of its compensation committee that gave Blankfein his enormous bonus and salary of $21 million in 2012. Johnson helped create the great financial crisis by choosing Mozilo to chair Fannie Mae's National Advisory Council thus playing a key role in making sure that the quality of mortgage loans by Countrywide was highly compromised. President Obama asked Johnson to help him search for his vice-presidential candidate.
So now Johnson is chairman of Goldman 's compensation committee. What kind of independence is there in crony capitalism? None.
It's Good to Be a Goldman
By Robert Scheer - truthdig
Here’s a get-out-of-jail-free card, and while we’re at it, take this obscenely huge bonus for having wrecked the economy. As the inspector general for the Troubled Asset Relief Program pointed out in a devastating report this week, “excessive” compensation was approved by the Treasury Department for the executives of the three companies that required the largest taxpayer bailouts to survive.
In a stinging rebuke of Timothy Geithner’s Treasury Department, the report “found that once again, in 2012, Treasury failed to rein in excessive pay.” Whopping pay packages of $5 million or more were allowed by the Treasury Department for a quarter of the top executives at AIG, General Motors and Ally Financial, the former financial arm of GM.
But that’s nothing compared with the $21 million for last year’s work garnered by Lloyd Blankfein, CEO of Goldman Sachs, which is now free of TARP supervision. In addition to his paltry $2 million in salary, Blankfein received a $19 million bonus for his efforts. Not quite the $67.9 million bonus he got in 2007 before the market crash that his firm did so much to engineer, but times are still hard.
Goldman was the training ground for Robert Rubin and Henry Paulson, the two Treasury secretaries who did their best to grease the skids for Wall Street hustlers. It was Rubin under President Bill Clinton who pushed to get the law changed to allow investment banks like Goldman to become commercial banks, and it was Paulson under President George W. Bush who permitted Goldman to take advantage of that loophole and partake in the low interest Fed money available to the commercial banks. Throw in the AIG bailout that allowed the passage of billions of dollars to Goldman, and you get the picture.
Read the whole article here