Suite Deal

Most of the time, Juan Antonio Samaranch lives in a two-room hotel suite in Lausanne, Switzerland. It has a balcony that commands a stunning view of Lake Geneva. The International Olympic Committee pays for it, about $200,000 a year.

As president of the IOC, Samaranch travels the world. Sometimes he goes in a private jet. Usually, he goes commercial, but only in first or business class. Never coach. The IOC typically pays $400,000 or more a year to fly him around.

As Samaranch prepares to testify today before Congress, all but sure to be asked whether his ways make him the living symbol of the excesses that have led to the worst corruption scandal in Olympic history, the details of his compensation package--available for the first time--reveal a surprise.

He’s one of the world’s great bargains.

Samaranch has been president of the IOC since 1980. He heads a worldwide enterprise projected to have generated $3.5 billion in revenue between 1997 and 2000. Yet he draws no salary. The IOC picks up the suite and the air fare. He gets a car and medical insurance.

That’s it, according to IOC records newly available to the press under a reform package the IOC fully adopted last weekend.

The reforms mark the IOC’s response to the scandal, which exploded a year ago with revelations that officials in Salt Lake City had showered IOC members with more than $1 million in cash, gifts, scholarships and other inducements to help win the 2002 Winter Games. Six members were expelled. Four more resigned.

Samaranch--who became the lightning rod for much of the resulting criticism of the IOC, in part because of public perception of his lifestyle--will explain the IOC’s version of events when he testifies before the U.S. House Commerce Committee’s subcommittee on oversight and investigations.

Asked in an interview Monday in Lausanne what people might think about his compensation package, Samaranch said with a smile, “They have to think I’m a very cheap president.”

Pausing on his way out the door--he was leaving for the Geneva airport to fly to London so he could hop on the Concorde to make today’s hearing--he also said, “If I was the president of a huge corporation . . . I’d have to get $3 or $4 million a year. Minimum.”

Experts in executive compensation said that Samaranch is, indeed, a steal.

“This guy probably wouldn’t even place in the Fortune 1000 here in the United States--and just think about the complexity of his job,” said Brent M. Longnecker, an executive vice president at Resources Connection in Houston.

Added Ron Bottano, a partner at SCA Consulting in Los Angeles, “It’s obvious that as with many things, sports is a big business. There’s a lot of wealth transferred by what the IOC does. For somebody leading that organization, [Samaranch’s compensation package] does sound like quite a bargain.”

Samaranch can afford to do the magnanimous thing and take no salary. He grew up in Barcelona in a wealthy family, married into a family with money, serves now on nearly a dozen corporate boards and, he said, has made a variety of investments over the years. He declined to provide details of his personal finances.

For purposes of comparison, however, an executive currently being recruited for a U.S. company generating the IOC’s levels of revenue could reasonably expect an annual salary of nearly $1 million, according to an SCA databank.

Of course, any good executive would also get stock or stock options. That would bump the pay package alone to $1.6 million annually, SCA data indicates.

Then, naturally, there would be perks--such as the car Samaranch has at the ready. It’s a black Mercedes sedan, one of two dozen cars made available to the IOC each year in Lausanne by DaimlerChrysler, a corporate sponsor, according to Thierry Sprunger, the IOC’s in-house controller.

Samaranch travels as many as 200 days each year to visit heads of state as well as sports figures. Most CEOs, of course, fly in style. In addition, Samaranch is 79. Is it any wonder, Samaranch asked, that he flies in a private jet or at the front of an airliner?

“These are normal expenses,” he said.

From January through October of this year, the latest month for which figures were available, the IOC had paid 483,190 Swiss francs for Samaranch. Given the exchange rate, that figures out to about $320,000.

In 1998, the IOC paid out 690,813 francs, Sprunger said, or about $490,000.

When Samaranch is on the road, his hosts pick up his hotel tab, meals and other expenses. He is typically the guest of an international sports federation or the Olympic committee of the nation being visited.

When he’s away from Lausanne, the IOC pays to keep his two-room suite at the Palace Hotel. When he’s not there, the rate is about $70 a night.

When he’s there, it’s $233. A hotel room in New York can cost half as much--and that’s a room, not a two-room suite with a view.

Totals for 1999 at the Palace are not yet available. In 1998, the IOC paid $204,000 to keep up the room; the year before, it was $203,000. Those amounts also include working dinners and other expenses, Sprunger said.

“Living in a nice suite sounds, well sweet,” Bottano said. “But I wouldn’t say there’s anything excessive here.”

Reviewing all the figures once more, Longnecker said, “You almost want to ask, why does he do it?”