Bagels & Executive Perks

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What the bagel man saw

He is leery of disparaging individual companies or even most industries, for fear it will hurt his business. But he will say that telecom companies have robbed him blind, and another bagel-delivery man found that law firms aren't worth the trouble. He also says he believes that employees further up the corporate ladder cheat more than those down below. He reached this conclusion in part after delivering for years to one company spread out over three floors -- an executive floor on top and two lower floors with sales, service and administrative employees. Maybe, he says, the executives stole bagels out of a sense of entitlement. (Or maybe cheating is how they got to be executives.) His biggest surprise? ''I had idly assumed that in places where security clearance was required for an individual to have a job, the employees would be more honest than elsewhere. That hasn't turned out to be true.''

Perk Hogs

[T]here is substantial evidence that perks hurt a company’s bottom line. David Yermack, an economist at N.Y.U. who specializes in executive compensation, looked at the performance of more than two hundred big American companies between 1993 and 2002, comparing those which allowed their C.E.O.s to use company jets for personal purposes with those which did not. Even after accounting for a host of other factors, Yermack found that the long-term stock-market performance of perk-rich companies was dramatically worse than that of their peers, costing shareholders hundreds of millions of dollars a year.

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This page contains a single entry by was published on June 7, 2004 6:31 PM.

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