Fonterra’s $8m man’s final pay revealed
Fonterra has revealed that former chief executive Theo Spierings has already pocketed a final payment of $4.6m.
The sum was due to be disclosed in the company’s annual report in September, but after mounting questions about the size of the payment, Fonterra has opted to release the figure early.
Spierings’ annual salary package of $8.08m attracted considerable criticism, particularly in the wake of Fonterra posting its first ever loss of $196m for the 2017-18 year, followed by an expected loss of between $590 million and $675m this financial year.
A Fonterra spokeswoman said the final $4.6m covered the final 25 per cent of a deferred incentive payment for financial years 2016 and 2017, and Spierings’ final remuneration for financial year 2019, including his base salary, superannuation, and holiday pay.
Spierings had received the payout when he left Fonterra in August 2018.
Fonterra said the incentive payments, deferred over two years, were part of a velocity leadership incentive scheme that senior management and a select number of employees were eligible to participate in. Regional Economic Development Minister Shane Jones is among those who have blamed Fonterra’s poor financial performance on bad management, and criticised Dutch-born Spierings saying he had ‘‘destroyed more dairy farming wealth than the GFC.’’ Income Equality Aotearoa New Zealand has joined the chorus of disapproval, attacking the number of Fonterra managers paid more than $1m a year.
Spokesman Peter Malcolm said basing remuneration on short-term performance targets while ignoring the long term stability of the company has been disastrous.
‘‘Research has shown that management bonuses invariably capture only the short-term performance of a company while being blind to long term financial sustainability.
‘‘I challenge directors of all companies to follow those commercial leaders who have seen the wisdom of spreading remuneration more evenly throughout the business in recognition that success is dependant on everybody who works there,’’ Malcolm said.