I had an interesting discussion with a friend with more than a casual interest in the future of Qantas recently.
His scenario goes like this:
Senior Management were paid what many considered were very attractive bonuses in the years of 'depression' of the airline. This year the CEO chose to forego his bonus, however a number of Executives and board members topped-up their shareholding when the price was close to its minimum and have subsequently had a significant win as the shares are now around $1.30.
My friend wondered aloud whether the intent was always to drive the share price lower, take 'modest' (by possible future standards) bonuses, establish a significant tie-up with Emirates and see the company's stock grow significantly.
Now executive management can go to the shareholders and brag about what an outstanding job they have done and how their bonus should be humungous given that in the bad times they were only 'entitled' to a mere $Xmillion in cash and shares.
"Couldn't happen" I said....trying hard to keep a straight face.
