Can Facebook’s Zuckerberg Buck Recent Trend of $1 CEOs?

Facebook�s initial public offering filing revealed that chief executive Mark Zuckerberg plans to cut his salary to $1 a year, joining other high-profile CEOs who have made what some say ultimately amounts to a public-relations gesture.

However, some academic research suggests investors in companies where the chief takes home a dollar or less in salary every year don�t profit after these moves. Also, these rock-bottom salaries can be a smokescreen obscuring the fact that these CEOs are already fabulously wealthy thanks to stock ownership and other goodies.

�CEOs with these arrangements, despite the drastic cuts in salary, have total compensation that is similar to that at other firms, making up lost salary through not-so-visible forms of equity-based compensation,� according to a 2011 paper from the Fisher College of Business at Ohio State University.

�Shareholders of firms with $1 CEO salaries do not fare well in the aftermath of these adoptions,� the professors wrote. �Thus, rather than being the sacrificial acts they are projected to be, our findings suggest that adoptions of $1 CEO salaries are opportunistic behavior of the wealthier, more overconfident, influential CEOs.�

Chrysler�s Lee Iacocca was the first CEO to slash his salary to $1 annually in the late 1970s, and many other top executives — often at troubled companies — have followed in his wake. Critics argue these arrangements are simply designed to deflect attention away from massive stock and options packages CEOs receive.

Here�s a look at some other CEOs of note making a buck:

• Meg Whitman, Hewlett-Packard (NYSE:HPQ): Whitman agreed to a $1 salary when she joined the information technology giant in September 2011 following the disastrous reign of Leo Apotheker. Hewlett-Packard shares are down nearly 40% over the past year, though up 20% since Whitman came aboard. However, the company still is struggling with poor execution as well as changes in strategy and management, such as reversing the decision to spin off the personal-computer business.
• Larry Ellison, Oracle (NASDAQ:ORCL): Oracle�s co-founder has been CEO of the firm for more than three decades. Although Ellison�s annual salary is $1, he owns more than 20% of the company and his total compensation was $77.6 million during fiscal 2011, according to Morningstar. �In addition, given the size of his stake in Oracle, we don’t believe that receiving a growing number of stock option grants will necessarily increase his commitment to the long-term success of the firm,� the investment researcher added.
• John Mackey, Whole Foods (NASDAQ:WFM): Mackey�s $1 salary has been in place since 2006, which makes sense to some investors since grocery chains seem to be in a race to the bottom with thinning profit margins and higher commodity costs. Whole Foods has a policy that caps salaries at 19 times the average total compensation of all full-time employees. Mackey in late 2006 said he would forgo any future stock options awards. �I have reached a place in my life where I no longer want to work for money, but simply for the joy of the work itself and to better answer the call to service that I feel so clearly in my own heart,� he said at the time.
• Larry Page, Google (NASDAQ:GOOG): Google�s co-founder took the reins from Eric Schmidt last year and has received a salary of $1 a year since 2007 after making the request three years before that. But don�t cry for Page — his net worth was estimated to be nearly $17 billion in 2011.
• Richard Kinder, Kinder Morgan (NYSE:KMI): Kinder has a $1 annual salary, but his net worth of more than $6 billion makes him one of the wealthiest U.S. citizens. The Kinder Morgan companies include Kinder Morgan, Kinder Morgan Energy Partners, L.P. (NYSE:KMP) and Kinder Morgan Management, LLC (NYSE:KMR). Aside from the $1 salary, he receives no bonuses or stock options, but owns 30% of KMI.