CEO pay key topic at BCE annual meeting amid layoffs
Frustration over BCE Inc.’s 4,800 job cuts earlier this year spilled over at the company’s annual general meeting on Thursday, as investors and employees questioned executives on their compensation during a period of belt-tightening for staff.
But board chair Gordon Nixon and Bell Canada president and CEO Mirko Bibic defended the decision, with the former referring to last year as a “challenging but also very transformational year” for the Montreal-based telecom and media giant.
Bell announced the job cuts in February amid a restructuring plan that saw it sell 45 of its 103 radio stations and close 107 The Source stores. The move drew widespread backlash, including from Prime Minister Justin Trudeau, who specifically called the 440 eliminated media positions at the company a “garbage decision.” The same day it announced the layoffs, BCE raised its quarterly dividend by three cents per common share, to 99.75 cents per common share.
One question during Thursday’s meeting called on the company’s leadership to explain that decision amid “such a tough economic time,” suggesting there was a disconnect between the thousands of job cuts while BCE reported more than $2.3 billion in annual profits for 2023 and hiked the dividend.
Nixon acknowledged it was a “logical question.”
“Those earnings are large numbers, but as you know, they have not been growing at the rate that we would like as a company in order for our shares to grow and our dividend to grow even at a higher rate,” he said.
“The ability of us as a public company to grow, to invest, to attract capital, to make capital investments, is contingent upon our ability to grow our earnings and to grow our dividend and to perform.”
Bibic added the company eliminated a number of vacant positions as part of the cuts to minimize the effect on current staff and also offered unionized employees a voluntary buyout.
In response to another question about whether the eliminated positions affected only lower tiers of the workforce, Bibic said there were changes “at all levels of the company.” He said the number of vicepresidents at BCE is down 20 per cent since 2020 and “we are collapsing the executive roles across the company as well.”
But some took aim at Bibic, himself. One question focused on whether BCE considered lowering his compensation as others lost their jobs.
Bibic’s total compensation for 2023 was $12.4 million, up three per cent compared with 2022, documents circulated to shareholders for the meeting show. The bump was attributed to a $500,000 “longterm incentive award” meant “to continue his compensation progression and to address market competitiveness.”
No changes are planned to Bibic’s target compensation for 2024, according to the documents.
Nixon said BCE is “well-below” its competitors when it comes to CEO pay and executive compensation as a whole. He noted the company determines those figures through advice from a consultant hired to assess performance and the competitive environment.
Unifor, which represents around 19,000 telecommunications workers at BCE and 2,100 members at Bell Media, had urged shareholders in an open letter on Wednesday to pressure the company for answers.
Earlier in the day, BCE reported its first-quarter profit fell compared with a year ago as it faced higher severance, acquisition and other costs related mainly to job cuts. It also said it faced increased net mark-to-market losses on derivatives, higher interest costs and increased depreciation and amortization expenses.