Executive Compensation at Nabors Industries: Too Much, Too Little, or Just Right?

Posted: 3 Oct 2009

See all articles by David F. Larcker

David F. Larcker

Stanford University - Graduate School of Business

Brian Tayan

Stanford University - Graduate School of Business

Date Written: February 10, 2007

Abstract

Eugene Isenberg, CEO of Nabors Industries, was listed in a 2006 Wall Street Journal article as one of the highest paid executives in the U.S. over the previous 14 years. He received this compensation as a result of a unique bonus arrangement and large stock option grants with several favorable features. At the same time, the strategy that he implemented for Nabors led to a remarkable financial turnaround as the company emerged from bankruptcy and expanded to become a global leader in the oilfield services industry. Readers of the case are asked to evaluate the structure of Isenberg's compensation agreement with Nabors Industries in light of the company's industry, strategy, and financial position. Particular consideration is paid to the total compensation, mix of compensation, performance measures, and other compensation terms.

Keywords: Executive Compensation, Board of Directors, Performance Measurement, bonuses, Corporate Governance, Bankruptcy, stock options, bankruptcy reorganization

JEL Classification: G3

Suggested Citation

Larcker, David F. and Tayan, Brian, Executive Compensation at Nabors Industries: Too Much, Too Little, or Just Right? (February 10, 2007). Rock Center for Corporate Governance at Stanford University Case Teaching No. CG -05. Available at SSRN: https://ssrn.com/abstract=1481841

David F. Larcker (Contact Author)

Stanford University - Graduate School of Business ( email )

Graduate School of Business
518 Memorial Way
Stanford, CA 94305-5015
United States
650-725-6159 (Phone)

Brian Tayan

Stanford University - Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

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