Glaxo to pay first woman CEO less

New Straits Times - - Business -

LON­DON: Emma Walm­s­ley, poised to take over as the first fe­male chief ex­ec­u­tive officer (CEO) of Glax­oSmithK­line Plc, will earn about a quar­ter less than her pre­de­ces­sor An­drew Witty to re­flect her lack of ex­pe­ri­ence at the helm.

Walm­s­ley would be paid an an­nual base salary of about £1 mil­lion (RM5.41 mil­lion), said the drug­maker in its an­nual re­port.

That com­pares with Witty’s pay of £1.15 mil­lion last year. Her tar­geted bonus doesn’t ex­ceed her salary, whereas Witty was given the op­por­tu­nity to col­lect 125 per cent of his pay through the bonus.

The lower com­pen­sa­tion, for a woman who is break­ing the gen­der bar­rier to be­come the first fe­male to man­age one of the world’s top 25 phar­ma­ceu­ti­cal com­pa­nies, is likely to re-ig­nite a de­bate on the pay gap be­tween the sexes. But it isn’t un­usual that com­pen­sa­tion lev­els change when a new CEO takes of­fice as boards seek to link pay pack­ages to the per­son’s level of ex­pe­ri­ence and ten­ure.

“This is the mo­ment to re­assess the ex­ec­u­tive pay struc­ture,” said Stefan Stern, di­rec­tor of the High Pay Cen­tre, a think tank on top United King­dom ex­ec­u­tive re­mu­ner­a­tion. “It’s good to fo­cus on the con­tri­bu­tion from the new per­son and it’s good to be tough and pay some­body less than their pre­de­ces­sor if their cur­ricu­lum vi­tae is at a dif­fer­ent stage.”

Witty, who was also ini­tially paid less than his pre­de­ces­sor, would have been CEO at Glaxo for al­most a decade when he leaves at the end of the month.

Glaxo chair­man Phil Hamp­ton, who as di­rec­tor at An­glo Amer­i­can Plc over­saw the cap­ping of ex­ec­u­tives’ bonuses there, also heads a gov­ern­ment-backed re­view on how to in­crease the num­ber of fe­male ex­ec­u­tives at the UK’s 350 big­gest com­pa­nies.

Pas­cal So­riot, who heads smaller Bri­tish drug­maker As­traZeneca, re­ceived a 2.5 per cent bump in his salary to £1.22 mil­lion this year, and can earn up to 180 per cent of his base pay as a bonus.

He also gets long-term in­cen­tives that could be as much as 500 per cent of his salary, com­pared with 550 per cent for Walm­s­ley. Bloomberg

Emma Walm­s­ley

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