Golden parachute definitions
| Word backwards | nedlog etuhcarap |
|---|---|
| Part of speech | The part of speech of the term "golden parachute" is a noun. |
| Syllabic division | gold-en par-a-chute |
| Plural | The plural of the word golden parachute is golden parachutes. |
| Total letters | 15 |
| Vogais (4) | o,e,a,u |
| Consonants (9) | g,l,d,n,p,r,c,h,t |
Golden parachutes refer to lucrative financial agreements between a company and its executives or top-level employees. These agreements are designed to provide substantial benefits in the event of a change in control of the company, such as a merger or acquisition. The purpose of a golden parachute is to ensure that key employees are retained and incentivized to stay on through times of uncertainty or transition.
Benefits of Golden Parachutes
Golden parachutes can provide a sense of security for executives who may be uncertain about their future with the company. These agreements often include substantial cash payouts, stock options, bonuses, and other benefits that can make a departure more financially feasible. Additionally, golden parachutes can help attract top talent to a company, as potential executives may be more willing to take on a high-level position knowing they will be well compensated in the event of a change in control.
Controversy Surrounding Golden Parachutes
While golden parachutes can be beneficial for executives, they are often criticized for being excessive and not aligned with the interests of shareholders. Critics argue that these agreements can lead to executives prioritizing their own financial gain over the well-being of the company. Additionally, golden parachutes can be costly for companies, especially in situations where multiple executives are entitled to large payouts.
Key Components of Golden Parachutes
Golden parachutes typically include provisions such as severance pay, accelerated vesting of stock options, retention bonuses, and other incentives to encourage executives to stay with the company through a transition. These agreements are often detailed in executive employment contracts and are subject to scrutiny from shareholders and regulatory bodies.
Overall, while golden parachutes can serve as a valuable tool for retaining top talent and providing executives with a sense of security, they can also be controversial and costly for companies. It is essential for organizations to carefully consider the terms of these agreements and ensure they are aligned with the long-term interests of the company and its stakeholders.
Golden parachute Examples
- The CEO negotiated a golden parachute in his contract in case of a hostile takeover.
- The departing executive received a generous golden parachute as part of his severance package.
- Investors were concerned about the cost of the golden parachute for the company's top executives.
- The board of directors approved a golden parachute agreement for key employees in case of a merger.
- Shareholders questioned the fairness of the golden parachute terms for the outgoing CEO.
- The company faced backlash for awarding a golden parachute to a departing executive who underperformed.
- Employees were surprised to learn about the generous golden parachute provided to the CFO.
- The golden parachute clause in the CEO's contract included stock options and equity grants.
- The golden parachute triggered when the company was acquired, leading to significant payouts for top executives.
- After the acquisition, the executive team relied on their golden parachute provisions to secure their financial future.