Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, June 14, 1994 TAG: 9406210065
SECTION: BUSINESS PAGE: C7 EDITION: METRO
SOURCE: New York Times
DATELINE: LENGTH: Medium
With the kind of marketing flair that made a household name out of a business begun in an abandoned gas station 16 years ago, the company announced a contest inviting its customers to explain why they should succeed Cohen.
But with a concession to financial reality and at the expense of the social activism for which Ben & Jerry's Homemade Inc. also became famous, it said it had abandoned its policy that no executive be paid more than seven times the salary of the lowest-paid employee. The company said it knew it would have trouble finding qualified executives who would take the job with that restriction.
Wall Street had expected a change. Ben & Jerry's stock has slumped as competition has increased in the slow-growing superpremium ice cream segment of supermarket sales and as the company has had trouble exploiting expansion opportunities in stores and overseas.
The company, based in Waterbury, Vt., earned $7.2 million on sales of $140.3 million in 1993. Its shares, which are traded over the counter, fell from $32 just over a year ago to $14.75 early this year. They closed at $13.25 Monday, up 25 cents.
``We have never had an experienced CEO and we have reached the point in our life when we need one,'' said Cohen, 43. He plans to continue as chairman and concentrate on what he called ``fun stuff'' like product development.
Still, Cohen's step away from the helm may worry some of the company's fans, who have been attracted not only to its numbingly rich products but also to its longstanding commitments to social activism and taste for outrageous fun.
Both the products and the counterculture corporate style are traceable to the quirks of the bearded Cohen, a man who taught crafts to emotionally disturbed teen-agers before starting the company, and of Jerry Greenfield, his childhood friend, fellow hippie and cofounder, who is vice chairman but who has been less involved in the business in recent years.
Cohen said he did not expect a big change in style or social commitment from anyone chosen as his successor.
The company said it was retaining an executive recruiting firm to handle the job search.
Under the company salary policy, Cohen last year was paid $133,212, the highest at the company, and received no bonus, according to filings with the Securities and Exchange Commission.
``It's a bit sad that they have to abandon the 7-to-1 ratio, because it was a noble experiment at a time when pay disparities are rising,'' said Joan Bavaria, president of the Franklin Research and Development Corp., a Boston company that manages investments for clients who have social concerns as well as monetary goals for their funds. ``But they will probably always have a more equal pay structure than most and it's a sign of maturity that they can move on.''
by CNB