Posted by Caroline Doran Millett, Partner
Willis Towers Watson executive in $21m pay-off
An important piece in the Financial Times (22 November 2016), from key insurance journalist Oliver Ralph, again highlights the troublesome issue of senior executive pay in the upper echelons of the City.
And it is yet another example of the apparent mismatch between reward and performance.
The article reports that Deputy Chief Executive of Willis Tower Watson, Dominic Casserley, is set to walk away with a golden parachute package of $21m, where his contract has not been renewed. This is despite the fact that the share price has underperformed.
The news comes hot on the heels of the Investment Association’s recent warning to remuneration committee chairmen, which represent the top 350 public companies. In its open letter, the Association called on companies to publish how much their chief executives get paid compared to the average employee and to justify the amounts.
It also reinforces the concerns about the gap between the pay of directors and the wider workforce. With growing discomfort about the sums earned by chief executives, Theresa May has promised to rein in excessive pay for bosses that she says has left ordinary workers behind.
I was invited to comment on the news about Mr. Casserley for the FT piece. As featured in the article, my view is that the lack of clarity around Mr. Casserley’s remuneration entitlement in the documentation issued by the company was “unhelpful and opaque”. This is a frequent complaint by corporate shareholders. It is important that information on rewards for executives, particularly when the size of the payment is likely to raise eyebrows, is clear and accessible for shareholders.
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