Anew study shows that severance packages for CEO's had a negative affect on a company's performance. Having a break-up contract lowered stock returns by as much as 4% over three years, with the trend continuing after five years. The study found that those CEO's with cash-only break-up contracts were more likely to take risks with the company, and less likely to invest in research and development.
See "CEO Safety Net Invites Risk-Taking, Study Says", Leslie Kwoh, The Wall Street Journal, December 4, 2011