32 Firms That Renounced America Paid CEOs $439 Million Last Year

A trickle has turned into a torrent. Burger King’s announcement last week that it would buy Canadian donut darling, Tim Horton’s, and then move the merged corporation to Canada represents the 13th such deal announced this year. Most companies pursuing these “corporate inversions” have abandoned America for the express purpose of lowering their U.S. tax bills.

This year’s baker’s dozen of tax dodgers join 76 firms that have shed their U.S. identities and re-registered abroad since 1983, with 47 adopting inversions in the last decade alone, according to a May 2014 report by the Congressional Research Service.

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Firms that refuse to pay taxes to support the public services and people that have helped their businesses thrive defend their actions by saying they are simply responding to their financial obligations to shareholders to lower company costs and boost corporate profits. Does that passion for cutting costs carry over to the pay of company CEOs?

We looked at the pay of the 32 companies that have undergone foreign corporate inversions and continue to report their executive compensation in their annual proxy statements filed with the U.S. Securities and Exchange Commission (SEC). We counted salary, bonus, non-equity compensation, perks (including personal use of corporate jets, country club fees, and personal financial service planning), as well as the value of stock grants vested and stock options cashed in. We did not include the theoretical value of new stock grants or stock options.

The CEOs of these firms collectively took home $439 million in 2013, an average of $13.7 million per CEO. Eight of the CEOs pocketed more than $20 million each, and Stephen Luczo, CEO of Seagate Technology, took home nearly $46 million last year. Seagate is a cloud-based data storage firm that operates out of California but is incorporated in Ireland.

Inversion Date Company CEO Total realized pay (2013)
2000 Seagate Technology Stephen Luczo  $     45,983,571
1994 Helen of Troy Gerald Rubin  $     41,928,803
2008 ACE Limited Evan Greenberg  $     32,388,252
2012 AON Gregory Case  $     28,527,238
2012 Eaton A M Cutler  $     28,141,754
2013 Liberty Global Michael Fries  $     26,854,087
1996 Chicago Bridge and Iron Philip Asherman  $     24,905,336
2002 Ingersoll Rand M W Lamach  $     24,104,757
2013 Perrigo Joseph Papa  $     19,436,931
2000 Everest Reinsurance Joseph Taranto  $     16,884,027
2008 Covidien Jose Almeida  $     14,066,086
2011 Alkermes Richard Pops  $     13,240,087
2010 Valeant Michael Pearson  $     12,840,460
2012 Pentair Randall Hogan  $     12,527,625
2008 TE Connectivity Thomas Lynch  $     10,581,959
2009 ENSCO Daniel Rabun  $     10,545,183
2014 Medtronic Omar Ishrak  $        8,331,159
2002 Herbalife Michael Johnson  $        7,550,490
2002 Noble Corp David Williams  $        6,900,800
2000 Actuant (Applied Power) Robert Arzbaecher  $        6,801,432
1999 Transocean Steven Newman  $        6,594,307
2001 Foster Wheeler Kent Masters  $        6,231,992
2002 Weatherford International Bernard Duroo-Danner  $        5,801,947
2012 Jazz Pharmaceuticals Bruce Cozadd  $        5,725,092
1997 Tyco International George Oliver  $        5,414,355
2012 Rowan Companies Matt Ralls  $        4,601,781
2012 Tronox Thomas Casey  $        4,116,806
2014 Mallinckrodt Pharmaceuticals Mark Trudeau  $        2,118,129
1983 McDermott International Stephen Johnson  $        1,833,089
1999 Xoma John Varian  $        1,824,421
1999 White Mountain Insurance Raymond Barrette  $        1,245,289
2010 Global Indemnity Cynthia Valko  $           745,483
    TOTAL  $   438,792,728
    AVERAGE  $     13,712,273
Notes: Source of CEO pay data is company proxy statement (Form DEF 14A) filed with U.S. Securities and Exchange Commission. Data current as of Sept. 4, 2014. Total realized pay includes salary, bonus, non-equity incentive compensation, value of stock options exercised, and stock awards vested. Total realized pay excludes formulaic value of new stock option grants and new stock awards.

Helen of Troy CEO Gerald Rubin retired on Jan. 14, 2014, after serving less than seven months of the fiscal year. Reported numbers for Helen of Troy include only Mr. Rubin’s pay and do not include the pay of his successor for the balance of the year.

McDermott CEO Stephen Johnson left the company on Dec. 16, 2013, two weeks prior to the end of the fiscal year. Reported numbers for McDermott include only Mr. Johnson’s pay and do not include the pay of his successor, David Dickson.

These CEOs grew their companies with the protection of U.S. laws and with public investment in education, infrastructure, and basic research. But now that they’re successful, they no longer want to support the system that allowed and supported their growth.

Sen. Carl Levin (D-MI) and Rep. Sander Levin (D-MI) have introduced The Stop Corporate Inversions Act of 2014. The legislation would impose a two-year moratorium on inversions and change the rules governing them. Under the new rules, companies would have to be managed from outside the United States and give up ownership control to foreign partners in order to be considered a foreign company for U.S. tax purposes. U.S. managers could not use the legal change to reduce their corporation’s tax bill while maintaining their American lifestyle and control over their company. The Joint Committee on Taxation estimates this legislation would save the U.S. Treasury $19.5 billion over the next decade.

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Well, Democrats did get a start in responding to this with the latest budget by cutting food stamps to the elderly, disabled and working poor. Again.