Time and again, we see CEOs and similar executives make horrible decisions that massively damage a company both financially and in terms of reputation and the perpetrator is forced to resign, yet receives so much money as a going away present you’d think they’re being rewarded for their fuck up. Why??
In many cases those positions are terminal i.e. you fuck up company X and you are either never working again, or it will take you years to find a comparable position. The golden parachute is there to lower the risk for candidates when you offer the job. Is it abused? Of course it is, essentially becoming risk pay for people who aren’t taking any risks. Compare to the “poison pill” where any attempted takeover or removal of executives triggers a massive payout to them.