Cisco's Chambers named most overpaid American CEO

Chief executive of stumbling router vendor tops list compiled by 24/7 Wall St.

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It's always great to be No. 1. Well, almost always.

Cisco chief executive John Chambers has come out on top of a list of American CEOs. Sadly, however, it's a list of the most overpaid chief executives in the U.S.

Even more impressive, Chambers is the only tech executive to crack the list of of eight CEOs compiled by website 24/7 Wall St. Other top execs making the list include William Swanson of defense contractor Raytheon, Robert Stevens of Lockheed Martin, also a defense contractor (trend alert!), and Miles White of Abbott Laboratories.

Just to be clear, Chambers doesn't make the most money of all these CEOs. The 24/7 Wall St. list compares compensation with stock performance. Chambers comes out on top not because of his $18.87 million comp package in 2010, but because of his exorbitant pay combined with Cisco's (NASDAQ: CSCO) slumping share price, which was down 31.4% in the fiscal year ended July 30, 2011.

Here's what 24/7 Wall St. co-founder and editor Douglas McIntyre had to say about Chambers:

Cisco was once considered the most well-run large company in Silicon Valley. That has changed in the last year as it has become clear that Chambers, a dean of Valley CEOs, diversified that company too far beyond its core router business. Margins in the new set-top box, WiFi, and video conference businesses do not match those of routers. Chambers has begun a retreat from his M&A strategy, trying to refocus the company. He has had only limited success so far. Cisco has also announced that its rapid growth will slow considerably in the next two years.

And McIntyre didn't even mention Chambers' decision to kill off the top-selling Flip video camera, when he could have sold that business division to someone else and gotten some return on the $590 million Cisco spent for Flip in 2009. (Plus not bummed out a bunch of Flip fans.)

In a way Chambers is lucky because some of the heaviest competition for most overpaid CEO in the tech realm was recently eliminated -- namely Yahoo's Carol Bartz and HP's Leo Apotheker.

As for Microsoft's Steve Ballmer...well, he'd also be a candidate for the list, but apparently he's decided to accept compensation in the form of Xbox games and $50 gift certificates for some of Seattle's finest restaurants so as to dodge the cross-hairs of irate shareholders. That strategy has paid off so far.

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