golden parachute

[Victor Steinbok]

OED has

> golden parachute n. /Comm./ (orig. /U.S./) a long-term contractual
> agreement guaranteeing financial security to senior executives
> dismissed as a result of their company being taken over or merged with
> another.

This does not seem quite right. In current usage, it's overspecifying
the conditions. Carly Fiorina got a "golden parachute" when she was
booted from HP, but it had no connection to any mergers or take-overs.
University of California Regents were targeted in the early to mid-1990s
for their golden parachutes that they awarded each other--secretly
voting multimillion-dollar pension packages for their retiring
colleagues (discovered when UC President Gardner announced his
retirement). If I am not mistaken, the epicenter of that scandal was
some time in 1992.

The bottom line is that a "golden parachute" is any kind of generous
separation or retirement package offered to top executives /under any
circumstances/ and not just because of mergers and acquisitions.

  http://goo.gl/w4AN1
NY Times, January 22, 1996
> It turns out that Mr. Redstone may have saved his shrewdest deal for
> his longtime deputy, Frank J. Biondi Jr., whom he ousted last week as
> the president and chief executive of Viacom. Mr. Biondi could leave
> with tens of millions of dollars less than some of his peers who have
> been shown the door at other entertainment companies.
> Graef S. Crystal, an expert in executive compensation, estimated that
> Mr. Biondi would probably receive $12 million to $20 million in
> severance pay. In most industries, that would indeed be considered a
> golden parachute. In the media business, it may only be gold-plated
> Consider that Robert J. Morgado, who ran the Warner Music Group, one
> of five divisions of Time Warner, parachuted out of that company last
> year with an estimated $60 million. In nine years at Viacom, Mr.
> Biondi helped create a behemoth with revenue of nearly $11 billion.

Also note that the last paragraph has "parachute" as a verb that fits
neatly into parachute v. 2.: "To descend by parachute; to use a
parachute. Also in extended use." (This particular metaphoric use is not
offered among the examples.)

http://goo.gl/oAk6p
NY Times, May 2, 1993
> Q: Then what's your prediction for I.B.M.?
> A: I see two possible scenarios. One, Gerstner is the ultimate
> portfolio manager and hatchet man. For the next two years, he trims
> the fat and returns I.B.M. to profitability. Then, when there's no fat
> left to trim, the cash cows stop giving milk, and there are no new
> products, he gets the largest golden parachute in the history of
> American business. Also, both firms that I.B.M. used as headhunters
> claim that the other found Gerstner.



Having checked GNA, I see that my UC recollection is correct:

San Diego Union - Tribune - ProQuest Archiver - Apr 21, 1992
Regents back Gardner's retirement package again
> Despite pressure to scotch the deal, University of California regents
> yesterday ... amounts to what one critic called a "jewel-encrusted
> golden parachute. ...

Sacramento Bee - NewsBank - May 7, 1993
DEEPER CUTS DEMANDED IN UC EXEC PAY
> A year after his secretly granted golden parachute threw the
> University of California into turmoil, retired UC President David P.
> Gardner has collected more ...

There is a caveat. OED's citations start from 1981 and that appears to
be close to the earliest--if not THE earliest date. Several cases were
decided in courts in 1981-82 that approved the use of "golden
parachutes" as a "poison pill" defense against takeovers (OED has
"poison pill" in this sense to 1983). And, at that point, the meaning
may well had been a narrow one. Certainly the OED 1981 quotation only
refers to mergers, as do others. [This one appears to be from 1982,
although my verification was not fully conclusive.]

http://goo.gl/spv8R
> A "golden parachute" is a contract protecting core managers from
> "irreparable harm" in the event of unfriendly takeovers, mergers, or
> even plant closings.

There is a good reason for this. The original "golden parachutes" were
intended for the execs caught in hostile takeovers to land softly after
bailing out or being forced from the company. Given that the metaphor of
being pushed out of an airplane is a viable one, under these
circumstances, a golden parachute seems to be particularly appropriate.
But this narrow meaning appears to have been quickly abandoned in favor
of a broader one that covered /all/ soft landings.

     VS-)

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