GM Chief Executive Mary Barra Earned $16.2 Million in 2014
General Motors CEO’s pay was 80% higher than predecessor’s $9 Million 2013 pay
The Detroit auto maker’s 2014 executive compensation plans, outlined in an annual proxy report filed Friday with the Securities and Exchange Commission, represent a shifting compensation strategy. No longer restricted by Treasury Department pay guidelines, GM now has liberty to use the promise of bigger paydays to reward, retain and motivate top managers.
Ms. Barra, 53, earned 80% more than the $9 million package paid to former CEO Dan Akerson in 2013, even though her $1.6 million base salary is slightly lower than the $1.7 million base Mr. Akerson was paid.
Since taking over in January 2014, she has been managing an ignition-switch safety crisis that overshadowed her initial months in office. Ford Motor Co. F 0.57 % ’s Mark Fields earned an $18.6 million package for last year’s performance, including a half-year as CEO during which he was forced to lower certain near-term financial targets.
Vehicle recall costs of $2.8 billion hurt Ms. Barra’s overall compensation, and the packages earned by other top executives. Without those costs, GM would have achieved its goals for core business operations, the company said.
GM was bailed out by the Troubled Asset Relief Program in 2009, and has for several years been restricted by compensation rules. The government’s sale of its equity ended an era of TARP oversight.
In response the ignition-switch crisis, Ms. Barra, a career-long GM employee, fired 15 employees and launched an overhaul of the company’s culture. The auto maker was subject to several congressional hearings, and actions dating back to early last decade remain under investigation by the Justice Department.
In October, Ms. Barra unveiled ambitious financial targets and margin goals designed to guide the company beyond 2020. The auto maker earned $2.8 billion in net income last year, less than 2013 due to the costs of vehicle recalls.
In addition to her base salary, Ms. Barra earned a $2 million nonequity award, which was paid out at 74% to reflect company performance on earnings, market share and quality. The board didn’t adjust these awards to reflect personal achievements.
She also earned $11.8 million in stock awards, $350,000 related to pension compensation and $412,532 in miscellaneous income.
GM’s share price has waned since Ms. Barra’s appointment. Trading at $40.68 at the beginning of 2014, the stock ended the year at $34.91. It exchanged hands at $35.63 Friday, one day after the company’s first-quarter earnings report missed Wall Street expectations.
Ms. Barra earlier in 2015 faced off with former hedge-fund manager Harry Wilson and a group of investment firms. Initially demanding an $8 billion share buyback and representation on the board, Mr. Wilson’s group later settled for a $5 billion commitment and agreed to abandon the pursuit of director slots.
GM’s General Counsel Mike Millikin retired in 2014, but not before coming under intense congressional scrutiny for his role in the company’s handling of the ignition-switch problems. He earned $5.8 million in 2014, and was awarded a special retention award last March—at which point GM was subject to intense scrutiny—valued at $2 million.
The ignition-switch problem has been tied to 87 deaths. While criticized for being in the dark about several years of legal settlements and internal studies related to the problem, Mr. Millikin has been lauded by Ms. Barra as a trusted lieutenant who took immediate steps to help GM dig out of the crisis.
Mark Reuss, GM’s product chief, and newly hired GM Europe boss Karl-Thomas Neumann were also paid retention bonuses in 2014. Mr. Reuss, long part of GM’s management team, earned $9.5 million in total compensation.
Dan Ammann, a former Morgan Stanley investment banker, was promoted to GM president in 2014 and earned $8.5 million.
GM also said Novartis AG CEO Joseph Jimenez will join the board of directors. Neville Isdell, a former Coca-Cola Co. CEO, on the board since before GM’s bankruptcy, will retire. The moves are the latest in a series of changes to the auto maker’s board.
Labor Day 2014
Temp labor at record levels in US
By Andre Damon
2 September 2014
Obama and Biden postured as partisans of what they referred to as the “middle class,” even as a number of reports emerged documenting the devastating decline in conditions for the working class under the current administration.