Private equity investor and board director nightmare Carl Icahn spoke his piece about the recent financial firm turmoil on his blog Friday, lashing out at “the destructive trend” of granting hefty severance packages to executives who leave failing firms. Icahn, a longtime opponent of both exorbitant compensation packages and all-around market inefficiency, blasted the CEOs of companies that have been decimated in the credit crisis in recent weeks.
Two outgoing chief executives that Icahn specifically called to task were Daniel Mudd of Fannie Mae and Robert Willumstad of AIG. Mudd’s severance package was $9.2 million, while Willumstad will receive over $8 million despite AIG’s turnover to the federal government in the wake of diminished capital.
Though federal regulators have denied Mudd’s severance package, Icahn cites the outgoing executive as “[soaking] up a rich salary in recent years,” $11.6 million last year.
Icahn has railed against hefty executive and director pay packages throughout his career as an activist investor, making him a feared and despised figure amongst board rooms. “Examples of egregious pay-for-failure abound in corporate America these days,” said Icahn, “as though management is playing a game called ‘lose-take-all,’ only the shareholders are the real losers and are often left with nothing.”