Ray R. Irani (born January 13, 1935) is the former chairman and
chief executive officer
A chief executive officer (CEO), also known as a central executive officer (CEO), chief administrator officer (CAO) or just chief executive (CE), is one of a number of corporate executives charged with the management of an organization especial ...
of
Occidental Petroleum
Occidental Petroleum Corporation (often abbreviated Oxy in reference to its ticker symbol and logo) is an American company engaged in hydrocarbon exploration in the United States, and the Middle East as well as petrochemical manufacturing in t ...
. He has worked at Occidental Petroleum for over 20 years, serving as a director since 1984,
chief operating officer
A chief operating officer or chief operations officer, also called a COO, is one of the highest-ranking executive positions in an organization, composing part of the " C-suite". The COO is usually the second-in-command at the firm, especially if t ...
(president) from 1984 to 1990, and chairman and chief executive officer from 1990. During his early years, he worked with Occidental CEO
Armand Hammer
Armand Hammer (May 21, 1898 – December 10, 1990) was an American business manager and owner, most closely associated with Occidental Petroleum, a company he ran from 1957 until his death. Called "Lenin's chosen capitalist" by the press, ...
, 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.
[Elizabeth Douglass]
Occidental CEO's 2006 paycheck: $560 million
''Los Angeles Times'', April 7, 2007.
Personal life
Irani was born in
Lebanon
Lebanon ( , ar, لُبْنَان, translit=lubnān, ), officially the Republic of Lebanon () or the Lebanese Republic, is a country in Western Asia. It is located between Syria to Lebanon–Syria border, the north and east and Israel to Blue ...
and is of Palestinian origin. He received a
Bachelor of Science
A Bachelor of Science (BS, BSc, SB, or ScB; from the Latin ') is a bachelor's degree awarded for programs that generally last three to five years.
The first university to admit a student to the degree of Bachelor of Science was the University o ...
degree in chemistry at the
American University of Beirut in 1953. He moved in the same year to
Los Angeles, California
Los Angeles ( ; es, Los Ángeles, link=no , ), often referred to by its initials L.A., is the largest city in the state of California and the second most populous city in the United States after New York City, as well as one of the wo ...
, and at age 18, began graduate studies in physical chemistry at the
University of Southern California
, mottoeng = "Let whoever earns the palm bear it"
, religious_affiliation = Nonsectarian—historically Methodist
, established =
, accreditation = WSCUC
, type = Private research university
, academic_affiliations =
, endowment = $8. ...
. He received his
PhD PHD or PhD may refer to:
* Doctor of Philosophy (PhD), an academic qualification
Entertainment
* '' PhD: Phantasy Degree'', a Korean comic series
* ''Piled Higher and Deeper
''Piled Higher and Deeper'' (also known as ''PhD Comics''), is a newsp ...
in 1957.
[Eva Emerson]
Life Sciences Building Named in Honor of Alumnus
, USC College News, February 2007. He subsequently worked as a researcher for the
Monsanto Company
The Monsanto Company () was an American agrochemical and agricultural biotechnology corporation founded in 1901 and headquartered in Creve Coeur, Missouri. Monsanto's best known product is Roundup, a glyphosate-based herbicide, developed in the ...
until 1967 and joined the Shamrock Corporation. Prior to working for Occidental, he was president and chief operating officer of
Olin Corporation
Olin Corporation is an American manufacturer of ammunition, chlorine, and sodium hydroxide. The company traces its roots to two companies, both founded in 1892: Franklin W. Olin's Equitable Powder Company and the Mathieson Alkali Works. Olin ch ...
, a chemicals and metals company.
Irani is an honorary fellow of the
American Institute of Chemists
The American Institute of Chemists (AIC) is an organization founded in 1923 with the goal of advancing the chemistry profession in the United States. The institute is known for its yearly awards recognizing contributions of individuals in this fie ...
and is a member of the
Council on Foreign Relations
The Council on Foreign Relations (CFR) is an American think tank specializing in U.S. foreign policy and international relations. Founded in 1921, it is a nonprofit organization that is independent and nonpartisan. CFR is based in New York Ci ...
. He is currently a trustee of USC and co-chair of the board of trustees of the American University of Beirut. USC named a primary life sciences building as Ray R. Irani Hall on February 9, 2007.
In February 2012, Irani, was elected as a member of the
National Academy of Engineering
The National Academy of Engineering (NAE) is an American nonprofit, non-governmental organization. The National Academy of Engineering is part of the National Academies of Sciences, Engineering, and Medicine, along with the National Academy of ...
. He was recognized "for leadership in the petrochemical industry and processes for applications of particulate systems." This is considered the highest honor in engineering in the United States.
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.
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
Tax avoidance is the legal usage of the tax regime in a single territory to one's own advantage to reduce the amount of tax that is payable by means that are within the law. A tax shelter is one type of tax avoidance, and tax havens are jurisd ...
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 was 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
Rex Wayne Tillerson (born March 23, 1952) is an American engineer and energy executive who served as the 69th U.S. secretary of state from February 1, 2017, to March 31, 2018, under President Donald Trump. Prior to joining the Trump admini ...
, who led a company that has a market cap that was five times larger than Occidental Petroleum.
In 2010, former CFO and later president
Stephen Chazen
Stephen Chazen (1946 – 22 September 2022) was an American businessman. He was president and chief executive officer (CEO) of Occidental Petroleum from 2011 to 2016.
Early life
He was born in 1946. He earned a bachelor's degree in geology from ...
was named CEO of Occidental to replace Irani,
who planned to stay on as executive chairman until 2014.
Irani was removed from the board of directors of Occidental on May 3, 2013.
KB Home backdating scandal
Irani was a
KB Home
KB Home is a homebuilding company based in the United States, founded in 1957 as Kaufman & Broad in Detroit, Michigan. It was the first company to be traded on the NYSE as a home builder and was a Fortune 500 company from 2000 through 2008. It ...
director for 15 years until November 2007. Irani chaired the KB Home executive compensation committee during the time period when CEO
Bruce Karatz
Bruce E. Karatz (born October 10, 1945) is an American businessman and philanthropist. He is noted for his role as Chairman and CEO of KB Home,Berry, Kate (2004-9-6). "Coming home: Bruce Karatz started as in-house counsel, but learned the busines ...
lied about the company's practice of backdating options. Karatz was subsequently indicted and convicted April 21, 2010 on federal charges stemming from his actions and sanctioned by the SEC in a separate civil action. The KB Home shareholders expressed their lack of confidence in the board and the compensation committee by a 19% opposition vote against Irani, who resigned from the KB Home board of directors after 15 years of service. Occidental offered no explanation for his resignation in their proxy statement.
References
External links
Biographyfrom Businessweek.com.
{{DEFAULTSORT:Irani, Ray
Living people
1935 births
Businesspeople from Los Angeles
University of Southern California alumni
American people of Palestinian descent
American University of Beirut alumni
American University of Beirut trustees
American chief executives of energy companies
Lebanese businesspeople
Members of the United States National Academy of Engineering
American chief operating officers