# Prof. David Yermack on golden parachutes offered to CEOs during mergers

1 Faculty News July 29, 2014 ![Quartz logo](/sites/default/files/styles/246w/public/assets/images/con_038218.gif?itok=JIQPnzXd)>

Excerpt from [Quartz](http://qz.com/239360/one-reason-time-warner-execs-are-eager-to-sell-80-million-golden-parachutes/) -- "Compensation plans like these originated in the go-go days of the 1980s, as US corporate raiders perfected the art of the hostile take-over. [David Yermack](http://www.stern.nyu.edu/faculty/bio/david-yermack), a finance professor at New York University, says that managers were often loathe to give up their job, even if a deal made sense, so golden parachutes were created to take managers’ personal financial situation out of the picture, so they wouldn’t protect themselves while their companies stumbled."

[Read more](http://qz.com/239360/one-reason-time-warner-execs-are-eager-to-sell-80-million-golden-parachutes/)