(FORTUNE Magazine) – IF YOU'RE AMONG THOSE OUTRAGED BY CARLY FIORINA'S $42 million exit package from Hewlett-Packard or by James Kilts's $100-million-plus goodbye kiss from Gillette, I have discouraging news: You sound pathetic. I don't know whether CEOs, their lawyers, and pay experts literally roll their eyes when they hear your righteous yowls, but at least figuratively they must. After all, they're listening to people who seem absolutely clueless about what's making everyone so angry.

When HP shareholders who've lost millions complain about all that money going to Carly, when Massachusetts's attorney general launches an investigation of Kilts's severance deal, or whenever citizens get furious at some departing CEO's stupendous sendoff, they're missing a crucial point: It's way too late. The time for dudgeon was long ago, when the CEO signed the contract. What millions of people don't seem to understand is that those massive severance payments aren't devised by a board of directors working feverishly into the night after a CEO has quit or been fired. On the contrary, in virtually every case those payments were all baked in the cake years earlier.

That fact is especially important to remember now, with proxy season upon us. The annual directories of CEO pay will soon appear, reporting numbers sure to be big, some of them egregious. But maybe it's time for a new approach. Each year's CEO pay figures are interesting, for sure, but focusing on them means missing the bigger story. As the Fiorina and Kilts episodes show, we should pay attention not only to CEO pay but also to CEO pay contracts.

It wasn't always so. Time was, ten or 15 years ago, when most CEOs didn't have contracts. Now the vast majority of big-company CEOs do have them. The most munificent are usually the product of a familiar scenario: A company gets itself into deep trouble, the board dispatches a headhunter to find an outsider CEO to save the day, a supremely qualified but reluctant candidate expresses willingness, and the deliriously grateful board signs a contract promising every earthly emolument the candidate's $975-an-hour lawyer can think up.

That was the chain of events that brought Fiorina to HP and Kilts to Gillette. It also brought Ed Breen to Tyco, Pat Russo to Lucent, Jim McNerney to 3M, Bob Nardelli to Home Depot, and several other CEOs to their current jobs. All their employment contracts are publicly available documents worth far more attention than they usually get. Take a look. If you wonder why more CEO departure outrage is inevitable, you'll soon understand the main reasons.

●Firing a CEO for cause is virtually impossible. The contracts define "cause" in meticulous detail. It generally includes being convicted of a felony--just being indicted won't do--and sometimes it has to be a felony involving theft or moral turpitude. Other felonies are no problem. The one thing "cause" never includes is doing a bad job. So if, like Carly, a CEO is fired merely for producing lousy results, then that's being fired without cause--and of course firing a CEO without cause is going to cost a company major bucks.

●Termination benefits are specified precisely. CEOs have learned that the best time to negotiate an exit package is when you're hired. That's the moment--before you've actually done anything--that the board is most confident you'll be a miracle worker. It'll promise you anything, knowing you'll never be fired but rather will retire in glory, having earned every penny it hands you on the way out. Why ruin its fantasy?

●Option megagrants are just table stakes. Once upon a time, 100,000 stock options were a breathtaking grant. Now if a company can't offer the CEO millions of options, it isn't even in the game. Several hundred thousand shares of restricted stock are also becoming standard. Of course when a CEO gets fired without cause--or quits "for good reason," or if there's a "change in control," as those events are punctiliously defined--all those options vest immediately, and the restricted stock becomes unrestricted. In multimillion-dollar exit packages, that's where most of the millions come from. And it's all specified the day the CEO signs his contract.

Of course you realize where the savior-CEO desperation lovefest drama will be played out next: at Hewlett-Packard. The new chief will almost certainly come from outside the company and will probably extract stunning contract terms from the board. When it happens, I'll tell you all about it. ■

GEOFFREY COLVIN, senior editor at large of FORTUNE, can be reached at gcolvin@fortunemail.com. Watch him on Wall $treet Week With FORTUNE, weekends on PBS.