‘It means there’s been some transparency, and there’s been some sense of justice,’ Hollywood historian Cari Beauchamp told Moneyish.
Less would be more when it comes to Les Moonves’ potential exit package from CBS, industry experts say.
The network titan resigned Sunday after a second New Yorker investigation brought forth sexual harassment, sexual assault and retaliation claims from six additional women, bringing his tally of accusers up to 13. Moonves, 68, has admitted to three of the encounters, but maintained they were consensual and denied having retaliated.
The Time’s Up organization, in response, released a statement Sunday demanding “a commitment to real change” and “no reward for Les Moonves.” And after the network announced that Moonves and CBS would make a $20 million donation to organizations supporting #MeToo — to be deducted from any potential severance — Time’s Up deemed that sum “far from a solution.”
“You have $180 million set aside to pay Moonves. Use that money instead to help women,” the group tweeted Sunday, referring to the reported severance amount for which the CEO’s contract made him eligible. “Cleansing the company of this toxic culture demands real systemic change.”
Melissa Silverstein, founder and publisher of the site Women and Hollywood, agreed. “Use the money to rehabilitate women’s careers who have been denied career opportunities because of him; use it as the Les Moonves Penance Fund and give to people who are working on making workplaces safer,” she told Moneyish. “Give (#MeToo movement founder) Tarana Burke money. Fund her work.”
Moonves, who raked in $69.3 million in 2017, is entitled to zero severance money if he’s terminated for sexual harassment, according to his CBS contract. (After all, not all bids for a payout pan out: NBC didn’t plan to pay disgraced anchor Matt Lauer the $30 million his lawyers reportedly sought after his firing, per CNN, and casino mogul Steve Wynn was denied his $330 million in severance after he resigned amid sexual misconduct allegations.) But Moonves could still depart with $120 million pending the outcome of an ongoing probe by two outside law firms, according to his settlement agreement.
And details of the internal investigation, led by two firms that have previously repped CBS, will likely be kept confidential — a point that prompted “CBS This Morning” co-anchor Gayle King to call for transparency from her own network Tuesday. “I don’t know how we move forward if we at CBS don’t have full transparency about what we find,” King said during her show.
— CBS This Morning (@CBSThisMorning) September 11, 2018
These “golden parachute”-style contracts became widespread in the 1980s as protection for executives in the event that their companies were acquired, according to Peer Fiss, a professor of management and organization at the University of Southern California’s Marshall School of Business. “They were really meant to only be triggered in the event of a hostile takeover,” Fiss told Moneyish. By 1986, according to a paper co-authored by Fiss, 33% of the U.S.’s 250 largest corporations had in place golden parachutes — agreements for which could be highly variable, ranging from “bare bones” to “gold plated.”
The more excessive parachutes eventually prompted outcry, Fiss said, drawing questions over why executives who’d mismanaged a firm should be rewarded with generous compensation. “Within short order, such golden parachute agreements were called a ‘web of enrichment devices’ that were ‘grossly excessive and wholly unjustified’ … a ‘waste of corporate assets,’” he and his co-authors wrote. A tax-code revision under the 1984 Deficit Reduction Act denied tax benefits to “excess golden parachute payments,” they added, but the change both “legitimated” payments up to that threshold (2.99 times base salary) and moved the focus toward non-salary provisions like stock options and health insurance.
Today, Fiss said, “we use the term more broadly — it’s kind of an umbrella term that refers to all sorts of severance packages that are put into place in case of termination.” “By now, they’ve become part and parcel of all the executive compensation packages,” he said. “They’re a recruitment tool, as well — if you want to attract those folks that you think are going to be best positioned to lead your firm, they’re going to be expecting golden parachutes or large-scale severance packages at this point.”
Golden parachutes, Fiss added, reflect “the overall expansion and escalation of executive pay” in our country. The pay gap between U.S. CEOs and their employees has increased sixfold over three decades, according to Bloomberg; Moonves’ annual total compensation in 2017 was 595 times the median CBS employee compensation.
“It’s so much bigger than a parachute — it’s a freakin’ blimp,” writer and Hollywood historian Cari Beauchamp told Moneyish of the widening chasm between executive pay and worker pay. “The differential has just skyrocketed, and golden parachutes call attention to that.”
Pending the results of the probe, Fiss says he doesn’t expect the Moonves case to have much impact on executive compensation. But where #MeToo is concerned, he ventured, “much like Harvey Weinstein clearly had a profound effect, you would hope that this would also have an effect in terms of signaling that sexual harassment is absolutely unacceptable — and that power and position and money don’t protect you from that.”
If Moonves leaves CBS empty-handed, Beauchamp agreed, “it’s an important step.” “It means there’s been some transparency, and there’s been some sense of justice,” she said. “The fact that this man (who) derailed careers (and) made people lose opportunity has been dethroned — because he was a king — just goes to show how deep this moment is in our culture,” Silverstein added.
It’s also important to consider those who lost their own career opportunities as a result of sexual misconduct and retaliation, Silverstein said. “We’ll simply never know all their stories; we’ll never know what they could’ve done,” Beauchamp said. “That injustice is never going to be fixed.”
Time’s Up and its role in the Moonves severance conversation, Beauchamp suggested, serve as “a reminder that we’re not going to take this sitting down”; rather, people are going to make noise. And nearly a year in, Silverstein added, #MeToo isn’t just a “moment” anymore. “So men who are hiding under their desks in Hollywood waiting for it to end — they’re going to have to stay there a really, really long time,” she said. “Because it’s not going to go away. It’s a new world.”
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