Some large US companies have changed the bonus policy to save the income of top managers

Some large US companies have changed the procedure for allocating bonuses to top managers so that they will not lose much in prosperity due to the general decline in the stock market and slowdown in economic activity. About it informs Financial Times, citing the research organization Conference Board.

For example, hard drive maker Western Digital said that CEO David Goeckeler received $32 million in bonuses and compensation this year, up from $17 million last year. decrease in quotations of companies in the technology sector. But this did not affect the amount of payments to the head of the company, since the condition was removed from the accrual rules, according to which part of the amount of compensation is tied to the dynamics of the company’s shares.

Aircraft component maker AAR Corp said CEO John Holmes was given a $7.3 million option to offset lower payouts last year. Then, at the request of the US authorities, companies that received state assistance in connection with the COVID-19 pandemic were required to limit bonus payments to their management. Office furniture maker MillerKnoll paid its CEO Andrea Owen $1 million this year, renegotiating bonuses due to “disrupted supply chains.”

However, researchers report that in some cases such changes in the procedure for accruing bonuses to management are already causing dissatisfaction among shareholders. Conference Board managing director Matteo Tonello told the FT that “some investors have argued against excessive executive compensation and the lack of provisions to tie part of the bonuses to pre-set targets.”

Evgeniy Khvostik