DETROIT -- General Motors CEO Mary Barra received $16.2 million in total compensation during her first year leading the automaker, GM said in a regulatory filing today.
Barra's payout included a base salary of $1.6 million, stock awards totaling $11.8 million, and $2.1 million from a short-term, nonequity incentive tied to several performance measures, such as GM's pretax profit and global market share. Most of the rest represented changes in pension value and deferred compensation.
Barra had a tumultuous first year after taking over the CEO job on Jan. 15, 2014. Within weeks, GM had recalled 2.6 million older cars for a defective ignition switch that has been linked to 87 deaths so far. That triggered congressional and Department of Justice investigations and a wave of 84 more safety recalls covering 30.4 million vehicles, as GM scoured its system for past defects.
Those recalls cost the company more than $3 billion, and appear to have cost Barra about $170,000 in potential pay, based on a formula spelled out in the proxy for how GM calculated potential short-term incentive pay.
The CEO and GM's other top executives were awarded 74 percent of their target short-term incentives based on the company's performance in four areas: global quality, pretax profit, global market share and automotive free cash flow. Each was weighted equally, at 25 percent of the potential incentive.
The quality performance measured the lowest: The executives were paid just 64 percent of what they could have received.
The overall quality score was dragged down by poor performance on a quality measurement described in the proxy as "warranty and policy expense," which reflected the recall expenses. The executives were awarded nothing on that metric; a full payment would have boosted Barra's pay by $171,500.
Executives took home the most short-term incentive pay on the category of automotive free cash flow (92 percent of the full amount), followed by global market share (72 percent) and pretax profit (68 percent).
GM moved to a performance-based compensation model in 2014, phasing out a previous system that had been set under the terms of its 2009 government bailout. The previous method included stock awards, but didn’t tie them to performance measurements.
The biggest portion of Barra's compensation for 2014 -- $7.5 million in stock -- also is based on performance. That money doesn't vest until February 2017, and will be paid only if certain performance thresholds are met, the proxy says.
Barra's total compensation was less than that of Ford CEO Mark Fields in 2014, also his first year as CEO. Fields, who took Ford's top job on July 1, received $1.7 million in salary, $3.4 million in stock awards, $6.2 million in options and $3.2 million in nonequity incentive plan compensation, Ford said in its regulatory filing last month.
Former CEO Dan Akerson, who retired two weeks into the year, received $2.1 million, the proxy shows. That included a base salary of $850,000 and $1.1 million in nonequity incentives.
Barra's total compensation exceeded the $14.4 million that GM had estimated last year. That's because, during 2014, she was paid $1.76 million in stock awards that had been granted in 2013, and weren't included in GM's previous estimate.
New board member
GM also said today that it has nominated Joseph Jimenez, CEO of pharmaceutical company Novartis AG, to its board.
If elected at GM's annual shareholders meeting in June, Jimenez would replace E. Neville Isdell, a former Coca-Cola CEO who has been a GM director since 2009.
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