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Silicon Valley High-Tech Workers Rally in Defense of Stock Options

Protesters decry an accounting board plan that threatens a key compensation tool.

June 25, 2004|Joseph Menn | Times Staff Writer

PALO ALTO — When technology companies organize a protest, it looks something like this:

Protesters wear freshly silk-screened T-shirts, still bearing creases. They carry precisely laid-out computer-generated signs. And people like Juniper Networks Inc. engineer Kurt Schwartz spout catchy phrases like: "The proposal that's on the table should be reviewed in further detail."

The San Francisco Bay Area is well-known for its rallies. Silicon Valley got into the act Thursday as hundreds of high-tech workers came together in defense of stock options with all the spontaneity of synchronized swimmers.

The Financial Accounting Standards Board had come to town to solicit opinions on its proposal to require publicly traded companies to deduct the cost of stock option grants from their earnings. The change would reduce corporate profits, thereby discouraging one of the area's signature compensation perks.

In Silicon Valley, where stock options are as coveted as BMWs and Blackberry e-mail pagers, any threat to future grants is not to be taken lightly.

So companies like Cisco Systems Inc. and Sun Microsystems Inc., along with their allies and trade groups, bused in what police estimated was a crowd of about 700 to denounce the FASB proposal as one that would, among other things, hamper innovation, hurt the economy, deter the advancement of women and threaten national security.

Rally organizers faced a two-pronged challenge.

In the first place, they had to simplify the discussion, if only to make the slogans fit on the signs. Second, they had to evoke sympathy beyond what might ordinarily be accorded a band of well-paid professionals taking their lunch break in the sun.

Some journalists seized on a lone woman who marched with a hand-lettered sign that read, "Will Work for Options." Was she a victim of Valley downsizing?

Not exactly. Jeannette Bjoernsen turned out to be the manager of the stock-option program for customer-relations software firm Siebel Systems Inc.

Bjoernsen said she came "just to have my voice be heard," adding that her views didn't necessarily reflect those of Siebel.

Others represented their firms proudly. A team of 30 or so from Ditech Communications Corp. wore matching black T-shirts bearing their corporate logo. They held signs with slogans like "Proposed Accounting Standards Threaten Job Creation and Economic Growth" and "Don't Destroy the Economy; Save our Stock Options!!!"

The speakers did their best to inspire. "Innovation is not just about money," said Peter Giles, chief executive of San Jose's Tech Museum. "It's about life."

He recounted the story of Wilson Greatbatch, who invented the cardiac pacemaker and improved the quality of millions of lives. Offstage, Giles said he didn't know if Greatbatch had received or granted any stock options.

"There have been some major inventions that have happened without stock options," Giles said. "But that doesn't mean it's optimal."

Not all of the attendees displayed as much fervor as the executives who spoke. Technical writer and protest veteran Stacey Madamba said the last demonstration she had joined, against the war in Iraq, was "more passionate." After a questioning glance from her Electronics for Imaging Inc. co-workers, she elaborated.

"They're passionate here," she explained, "but on a much quieter level."

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