General Electric Company (NYSE:GE) chief executive John Flannery was paid US$9mln in 2017 – 157 times higher than the median employee salary – despite the multinational conglomerate stumbling through one of the toughest periods in its history.
In a filing late Monday, GE said Flannery’s salary was set at US$2mln which, when combined with stock options, pension and deferred compensation, took his total pay package to US$9mln for the year.
No bonuses
But the 55-year-old, along with all but one of his fellow executives, won’t be taking home a bonus this time around.
“The compensation committee did not award Mr. Flannery a bonus (with his concurrence), despite the 24% funding for the company bonus pool,” the company said in the SEC filing.
Only David Joyce, the chief executive for GE Aviation, received a US$1.4mln bonus in 2017, with the rest having to do without.
Worst performer on the Dow
Given that GE was the worst performing stock on the Dow Jones last year – plunging 45% and losing US$125bn from its market value – the move to slash bonus payouts is perhaps not surprising.
The Boston-headquartered giant saw revenues slip last year, while adjusted earnings per share came in at the bottom end of guidance, which had been reduced during the year.
Flannery, who officially came on board in August, immediately slashed the dividend, replaced several top managers and announced a series of “painful cuts” as he tried to get to grips with cash-flow shortfalls and flagging demand for GE’s gas turbines and other industrial equipment.
Ex-CEO took home US$8mln last year
Monday’s SEC filing revealed that the man who preceded Flannery, Jeffrey Immelt, received a total pay package of US$8.11mln for his final eight months in charge.
Immelt, who stood down from his role as chief executive in August and from the board two months later, received US$2.86mln in salary during 2017, plus almost US$2mln in perks – mostly relocation benefits.
The remaining US$3mln or so of the 62-year-old’s compensation reflected a change in the value of his pension and deferred compensation.
GE shares fell 4.8% to US$14.36 in early trading on Tuesday.