Story To Watch: Finchem, KB Home And Executive Compensation

Reader Stuart pointed out that the Law Firm of Levi & Korsinsky, LLP has launched an investigation into possible breaches of fiduciary duty by the Board of Directors of KB Home in connection with executive compensation. The national firm has done this before, including in several court-appointed instances.

PGA Tour Commissioner Tim Finchem sits on the KB Home board and has already avoided one potentially awkward scrape with angry shareholders over compensation committee work that approved a $9 million package to CEO Jeffrey Mezger during a year the company lost $1.41 billion.

Finchem was appointed to the KB Home board in 2005. Major League Baseball's Bud Selig is the only other commissioner to serve on a corporate board while also overseeing a professional sport.

Finchem's 2009 compensation of $4.7 million earned grumbling and snickers at a 2010 player meeting. Only about a quarter of that pay is salary, the rest a product of performance bonuses tied to "growing" the tour.

Compared to his PGA Tour compensation, Finchem's income from KB Home is minor, according to Forbes.

In late 2009 it was revealed that as executives received annual raises, Finchem instituted a series of layoffs in several departments and froze the employees 401k program.