Aflac afl CEO Dan Amos said Thursday that he will give up the $13 million golden parachute the insurance company would owe him were he to be fired or lose his job in a merger or acquisition.
"If they don't think I'm doing a good job, they don't have to worry about paying me off," Amos said in an interview with USA TODAY.
The decision to give up his exit package, worth three times his annual pay and bonus, comes as golden parachutes are under attack, especially those at companies receiving bailout money. The government denied exit packages to Daniel Mudd and Richard Syron, the departing CEOs of Fannie Mae and Freddie Mac. Under pressure, AIG has frozen the $19 million it owes former CEO Martin Sullivan. (Aflac says it doesn't need bailout money.)
Aflac also became the first major company to let shareholders vote on CEO pay. In May, Aflac shareholders voted 93% in favor of Amos' pay, with 2.5% against. Both President-elect Barack Obama and Democrats in Congress have expressed interest in making such non-binding shareholder votes on CEO pay mandatory.
Although Amos makes about $4.3 million a year in salary and bonus, his total compensation including stock options came to more than $14 million in both 2006 and 2007.
"It's kind of tough to say any CEO makes a personal sacrifice," Amos says, but adds that most negotiate golden parachutes when they are hired, knowing that job security is tenuous. CEOs are often compared to football coaches, he says, but fired coaches find other teams whereas dismissed CEOs tend to disappear.
However, CEOs often depart in failure at a time when it's embarrassing to pay them millions as they leave. Amos, 57, has been CEO for almost two decades and says he is pleased with Aflac's performance, even though it has not escaped the times.
Aflac stock is down 31% since Sept. 18, and the company reported a 76% drop in profit in the third quarter. Aflac had no direct investment in subprime loans, but it lost $198 million from its stock in Lehman Bros. and Washington Mutual. Operating earnings have remained strong, Amos says, and Aflac stock has outperformed indexes that measure the total market and the insurance industry.