The Greatest Job in Business
Clawing your way to the top of the corporate ladder has its appeal: The chairman and CEO get gobs of money, the power to move markets, the keys to the Gulfstream, and minions paid to nod their heads in awe. But really, it's so much work. Wouldn't it be better to be vice chairman?
There are no magazines about vice chairmen and no suck-up profiles in Fortune about them. They don't write advice books, because no one cares what they have to say. No one even cares if they show up in the office. In short—except for one slight drawback—they have the greatest job in business. You will not be surprised to learn that many of them are excellent golfers.
Corporate America is chock full of vice chairmen and anecdotally, at least, the number of people holding the job appears to be climbing. At some companies, it's not uncommon to have four or five vice chairmen at the same time, even though corporate headhunters say they never recruit for the position. That's because despite the lofty title, vice chairman is almost always considered a demotion—a clear sign that someone's career is stuck in neutral and about to head into reverse. (This is the drawback.)
"It's a great title for a position where you don't have to do anything," says Tom McLane, who happens to be vice chairman of the Directorship Search Group, an executive search firm based in Greenwich, Ct.
The greatest thing about the job—besides the hours, which tend to be limited since most vice chairmen don't have all that much responsibility, is that very few vices wind up taking a pay cut. Some even get raises. Newly public Valor Communications gave its former CEO, Kenneth R. Cole, a $5 million transition payment when it made him vice chairman last April. He's also collecting $300,000 in salary, despite being required to devote only around 25 percent of his time to the company. Three of Atlanta-based SunTrust Bank's vice chairmen made over $1 million last year in salary and bonus.
But don't dash off your résumé just yet. This is a tough job to get: It almost exclusively goes to a top executive who's been shafted.
One easy way to get the job is to lose out in the power grab to become CEO. That's what seems to have happened to Lois Juliber, a top executive at Colgate-Palmolive, who was named a vice chairwoman last July along with fellow top executive Javier Teruel. At the same time, the company named Ian Cook chief operating officer, a job viewed as next in line to become CEO. Last month, Juliber announced that she was retiring on April 1. Teruel is still there, at least for now, though he's undoubtedly talking to headhunters. Most vice chairmen who wind up with the job this way tend to get bored pretty quickly.
Another common path to vice chairman's office is through a merger. This is the primary reason that headhunters believe the ranks of vice chairmen have been growing. After all, there's usually only room for one No. 1 and in most mergers, that job belongs to the CEO at the company doing the buying. Big deals like the one between Procter & Gamble and Gillette, or SBC and AT&T are likely to lead to a wavelet of vice chairmen. Banks are particularly prolific when it comes to handing out the title: Last year, SunTrust had five vice chairmen and Charlotte-based Bank of America hadtwo. Merger-fallout vice chairmen tend to mill around the office for a year or two, before heading off to the golf course full-time.
Sometimes entrepreneurs wind up as vice chairmen when they decide they'd rather start spending the money they've made instead of spending all of their time glued to their BlackBerrys. Nextel co-founder Morgan O'Brien has been a vice chairman at the company since 1996, though he stepped down from active employment in November 2003. Outback Steakhouse announced this month that co-founder Robert Basham was stepping down as chief operating officer to become vice chairman.
Of course, some vice chairmen have actual responsibility. Berkshire Hathaway's Charlie Munger is widely viewed as Warren Buffet's partner despite having the vice chairman's title. And some vices eventually make it into the big chair. Jim Skinner was named vice chairman of McDonald's in December 2002. At the time, it was widely viewed as a sign that he was out of the running. But the company's next two CEOs died in quick succession, and Skinner was anointed CEO last November.
Michelle Leder writes a daily blog at www.footnoted.org that looks at SEC filings and is the author of Financial Fine Print: Uncovering a Company's True Value.
Photograph of golfer on Slate's home page © Royalty-Free/Corbis.