Ray R. Irani
Encyclopedia
Ray R. Irani is the current chairman and former chief executive officer
of Occidental Petroleum
. He has worked at Occidental Petroleum for over 20 years, serving as a director since 1984, chief operating officer
(president) from 1984 to 1990, and chairman and chief executive officer from 1990. During his early years, he worked with notable Occidental CEO Armand Hammer
, who at age 91, named Irani his successor in February 1990. According to Forbes.com, his five-year total compensation between 2001 and 2005 was $127,447,000. In 2006, after a rise in oil prices, Irani earned a total of $460 million.
and is of Palestinian
origin. He received bachelor of science
in chemistry at the American University of Beirut
in 1953. He moved in the same year to Los Angeles, California
, and at age 18, began graduate studies in physical chemistry at the University of Southern California
. He received PhD
in 1957. He subsequently worked as a researcher for the Monsanto Company until 1967 and joined the Shamrock Corporation. Prior to working for Occidental, he was president and chief operating officer of Olin Corporation, a chemicals and metals company.
Irani is an honorary fellow of the American Institute of Chemists
and is a member of the Council on Foreign Relations
. He is currently a trustee of USC and vice chairman of the board of American University of Beirut. USC named a primary life sciences building as Ray R. Irani Hall on February 9, 2007. He is married to Ghada Irani.
Irani made news in 2007, when it was revealed that his total compensation for the 2006 year topped $450 million. His base salary was $1.3 million. Occidental justified the compensation by pointing to the stock price, which had risen from $9 a share when Irani succeeded Hammer to $48.60 at the end of 2006, and to the company's market capitalization, which grew from $32.1 billion at the end of 2005 to $42.5 billion at the end of 2006. His compensation in 2009 totaled $31.4 million, including $1,170,000 in salary and $24,758,827 in stock. According to the Associated Press, within the last decade, Irani has received $857 million.
Irani put funds into an overseas tax shelter arranged by Deutsche Bank AG that the IRS later deemed an illegal tax avoidance scheme. The Occidental Chairman opposed the U.S. Department of Justice subpoena of Deutsche Bank AG records as part of an investigation of myCFO Inc. His appeal was rejected by the U.S. Court of Appeals in 2006. Occidental’s Board of Directors took no action against Irani despite the IRS ruling. An Occidental spokesman said that Irani’s participation in the tax avoidance scheme was a personal matter and was not a violation of the company’s code of conduct policy.
Irani and Occidental President, Stephen Chazen, ordered a reduction in company expenditures that resulted in hundreds of company job terminations, the majority of whom were veteran employees, in 2007-2008, at the height of the recession, the same year Irani collected a $460 million dollar total compensation package for 2006 and the company enjoyed record profits. Irani was subsequently awarded a $900,000 cash bonus by the Occidental board of directors for exceptional performance in implementing a cost-cutting initiative (including reduction in force job terminations) in anticipation of a “world-wide economic deterioration.” This was awarded on a discretionary basis by the Occidental compensation committee and not by any company performance metrics. Chazen collected $38,080,344 and Irani $76,107,010 in fiscal year 2010, nearly doubling his 2009 compensation despite shareholder outrage over the Occidental board of directors executive pay policies.
Irani retired as CEO on May 10, 2011 after the California State Teachers' Retirement System and Relational Investors, two major institutional Occidental Investors, objected to the company's compensation policies and announced plans to replace long-term board members who were described as "ossified" in a letter written in protest of Irani's salary. They also termed Irani's salary a "corporate giveaway program."
Irani's salary was considered excessive and not truly performance based for decades by a number of corporate governance authorities who noted that Irani's compensation had exceeded that of the head of energy giant ExxonMobil, Rex Tillerson, who leads a company that has a market cap that is five times larger than Occidental Petroleum.
Former CFO and current President Stephen Chazen was named CEO of Occidental to replace the 76 year-old Irani, who plans to stay on as executive Chairman until 2014.
Chief executive officer
A chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
of Occidental Petroleum
Occidental Petroleum
Occidental Petroleum Corporation is a California-based oil and gas exploration and production company with operations in the United States, the Middle East, North Africa, and South America...
. He has worked at Occidental Petroleum for over 20 years, serving as a director since 1984, chief operating officer
Chief operating officer
A Chief Operating Officer or Director of Operations can be one of the highest-ranking executives in an organization and comprises part of the "C-Suite"...
(president) from 1984 to 1990, and chairman and chief executive officer from 1990. During his early years, he worked with notable Occidental CEO Armand Hammer
Armand Hammer
Armand Hammer was an American business tycoon most closely associated with Occidental Petroleum, a company he ran for decades, though he was known as well as for his art collection, his philanthropy, and for his close ties to the Soviet Union.Thanks to business interests around the world and his...
, who at age 91, named Irani his successor in February 1990. According to Forbes.com, his five-year total compensation between 2001 and 2005 was $127,447,000. In 2006, after a rise in oil prices, Irani earned a total of $460 million.
Personal life
Irani was born in LebanonLebanon
Lebanon , officially the Republic of LebanonRepublic of Lebanon is the most common term used by Lebanese government agencies. The term Lebanese Republic, a literal translation of the official Arabic and French names that is not used in today's world. Arabic is the most common language spoken among...
and is of Palestinian
Palestinian people
The Palestinian people, also referred to as Palestinians or Palestinian Arabs , are an Arabic-speaking people with origins in Palestine. Despite various wars and exoduses, roughly one third of the world's Palestinian population continues to reside in the area encompassing the West Bank, the Gaza...
origin. He received bachelor of science
Bachelor of Science
A Bachelor of Science is an undergraduate academic degree awarded for completed courses that generally last three to five years .-Australia:In Australia, the BSc is a 3 year degree, offered from 1st year on...
in chemistry at the American University of Beirut
American University of Beirut
The American University of Beirut is a private, independent university in Beirut, Lebanon. It was founded as the Syrian Protestant College by American missionaries in 1866...
in 1953. He moved in the same year to Los Angeles, California
Los Angeles, California
Los Angeles , with a population at the 2010 United States Census of 3,792,621, is the most populous city in California, USA and the second most populous in the United States, after New York City. It has an area of , and is located in Southern California...
, and at age 18, began graduate studies in physical chemistry at the University of Southern California
University of Southern California
The University of Southern California is a private, not-for-profit, nonsectarian, research university located in Los Angeles, California, United States. USC was founded in 1880, making it California's oldest private research university...
. He received PhD
PHD
PHD may refer to:*Ph.D., a doctorate of philosophy*Ph.D. , a 1980s British group*PHD finger, a protein sequence*PHD Mountain Software, an outdoor clothing and equipment company*PhD Docbook renderer, an XML renderer...
in 1957. He subsequently worked as a researcher for the Monsanto Company until 1967 and joined the Shamrock Corporation. Prior to working for Occidental, he was president and chief operating officer of Olin Corporation, a chemicals and metals company.
Irani is an honorary fellow of the American Institute of Chemists
American Institute of Chemists
The American Institute of Chemists is an organization founded in 1923 whose goal is to advance the chemical profession in the United States. The institute is known for its yearly awards recognizing contributions of individuals in this field of work. The American Institute of Chemists Gold Medal is...
and is a member of the Council on Foreign Relations
Council on Foreign Relations
The Council on Foreign Relations is an American nonprofit nonpartisan membership organization, publisher, and think tank specializing in U.S. foreign policy and international affairs...
. He is currently a trustee of USC and vice chairman of the board of American University of Beirut. USC named a primary life sciences building as Ray R. Irani Hall on February 9, 2007. He is married to Ghada Irani.
Career at Occidental
Irani was brought to Occidental in 1983 to help its struggling chemicals division, and soon was promoted to president, replacing a series of presidents fired by Hammer. By 1988, the media reported that Irani and his team were running the day-to-day operations of the company on behalf of the then 90-year-old Hammer. In 2008 Irani was awarded options worth $392 million, which at the time was almost as much as all the shareholders combined.Irani made news in 2007, when it was revealed that his total compensation for the 2006 year topped $450 million. His base salary was $1.3 million. Occidental justified the compensation by pointing to the stock price, which had risen from $9 a share when Irani succeeded Hammer to $48.60 at the end of 2006, and to the company's market capitalization, which grew from $32.1 billion at the end of 2005 to $42.5 billion at the end of 2006. His compensation in 2009 totaled $31.4 million, including $1,170,000 in salary and $24,758,827 in stock. According to the Associated Press, within the last decade, Irani has received $857 million.
Irani put funds into an overseas tax shelter arranged by Deutsche Bank AG that the IRS later deemed an illegal tax avoidance scheme. The Occidental Chairman opposed the U.S. Department of Justice subpoena of Deutsche Bank AG records as part of an investigation of myCFO Inc. His appeal was rejected by the U.S. Court of Appeals in 2006. Occidental’s Board of Directors took no action against Irani despite the IRS ruling. An Occidental spokesman said that Irani’s participation in the tax avoidance scheme was a personal matter and was not a violation of the company’s code of conduct policy.
Irani and Occidental President, Stephen Chazen, ordered a reduction in company expenditures that resulted in hundreds of company job terminations, the majority of whom were veteran employees, in 2007-2008, at the height of the recession, the same year Irani collected a $460 million dollar total compensation package for 2006 and the company enjoyed record profits. Irani was subsequently awarded a $900,000 cash bonus by the Occidental board of directors for exceptional performance in implementing a cost-cutting initiative (including reduction in force job terminations) in anticipation of a “world-wide economic deterioration.” This was awarded on a discretionary basis by the Occidental compensation committee and not by any company performance metrics. Chazen collected $38,080,344 and Irani $76,107,010 in fiscal year 2010, nearly doubling his 2009 compensation despite shareholder outrage over the Occidental board of directors executive pay policies.
Irani retired as CEO on May 10, 2011 after the California State Teachers' Retirement System and Relational Investors, two major institutional Occidental Investors, objected to the company's compensation policies and announced plans to replace long-term board members who were described as "ossified" in a letter written in protest of Irani's salary. They also termed Irani's salary a "corporate giveaway program."
Irani's salary was considered excessive and not truly performance based for decades by a number of corporate governance authorities who noted that Irani's compensation had exceeded that of the head of energy giant ExxonMobil, Rex Tillerson, who leads a company that has a market cap that is five times larger than Occidental Petroleum.
Former CFO and current President Stephen Chazen was named CEO of Occidental to replace the 76 year-old Irani, who plans to stay on as executive Chairman until 2014.