Tony Petrello has been serving in an executive role with Nabors Industries since the early 1990s. Recently, he has made news by receiving a large payday in fiscal year 2013. Many critics of outsized corporate compensation packages have voiced concern that this is a disproportionate payday, given what Mr. Petrello has accomplished. However, nothing could be further from the truth.
Mr. Petrello has led the firm from the verge of bankruptcy to become one of the most prominent oil services firms in the United States today. In 1986, Nabors Industries was in Chapter 11, with its future hanging in the balance. It was not until the year 1991, when Tony Petrello was brought on board as a chief operating officer, that Nabors Industries really started its upward trajectory that hasn’t stopped, all the way to the present.
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That’s not to say that Mr. Petrello was compensated lushly throughout his entire career. For most of his career, which has spanned over 25 years with the company, he has been compensated modestly, in accordance with normal corporate compensation protocols. It wasn’t until ascending to the role of chief executive officer that Mr. Petrello became eligible for larger compensation packages, which included stock options and performance bonuses. But it was only after overseeing a rise of 200% in the company’s stock valuation that Mr. Petrello received his large payday.
It’s only fair that a man who is almost single-handedly responsible for the phenomenal stock performance of a company, over a 20-year period, should be compensated according to the principle that performance should be justly rewarded.
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