Glaxo’s China Probe Means a Bonus Cut for the CEO
GlaxoSmithKline’s (NYSE:GSK) executives saw smaller bonuses this year than “they might otherwise have been,” due primarily to the aftermath of a massive corruption scandal in China. The scandal has led to a Chinese investigation, which began in July, regarding bribery allegations against the company, the Guardian reports.
Chief executive Andrew Witty collected 1.9 million pounds ($3.18 million) in salary for 2013. All total, Witty received a pay and shares package of 6.5 million pounds, collecting approximately 3.5 million pounds in share awards and 67,000 pounds in benefits. The company’s remuneration committee, however, decided against awarding him the maximum possible bonus of 2.12 million pounds as a result of the Chinese bribery scandal.
Despite the scandal, Witty’s annual pay and shares package almost doubled in 2013; the chief executive received 6.5 million pounds in 2013, up from approximately 3.9 million pounds in 2012.
“Both Sir Andrew and the board are mindful of the impact this issue has had on the reputation of the company,” said Tom de Swaan, chair of the board’s remuneration committee in a statement, per the Guardian. “As a result, the bonuses awarded for 2013 were lower than they otherwise might have been.”