GM CEO Mary Barra earns $16.16M in 2014
General Motors Co.'s new CEO Mary Barra made $16.16 million in total compensation last year, a figure exceeding her target but short of amounts she and other executives could have earned if business performance objectives had been fully achieved.
Barra, who became the auto industry's first female CEO on Jan. 15, 2014, taking over for a retiring Dan Akerson, had a target to earn $14.4 million in 2014. She made more than the target because she received $1.76 million in restricted stock awards that were for 2013 performance, the Detroit automaker announced Friday as part of the release of its proxy filing to federal regulators.
Her target pay package as CEO includes $1.6 million cash base salary, $2.8 million short-term cash compensation and $10 million long-term compensation that is paid in stock. Her actual base salary came in a bit short of that, at $1.57 million, due to when she started the CEO job in the year and because short-term cash compensation was $2.07 million. She earned a total of $11.76 million in stock awards.
Last year was the first full year GM had from pay restrictions for executives it was tied to for several years under government ownership. In 2014, GM transitioned to a pay system for executives that incentives them for their and company performance. It was also a year in which the automaker was rocked by an ignition switch recall crisis.
Barra, 53, and other executives fell short of what they could have earned as part of the company's short-term incentive plan, an annual cash award. Executives are compensated based on the company's business performance and they also can receive an adjustment for individual performance.
For example, Barra's target was to earn 175 percent of her base salary, or $2.8 million.
Business performance goals were equally weighted at 25 percent each for adjusted earnings before interest and taxes, adjusted automotive free cash flow, global market share and global quality. The actual cash payout ranges is 0 to 200 percent of each executive's target and is based on company performance: it was 74 percent for all executives last year.
The biggest miss was on global quality last year, particularly in warranty and policy expense tied to recalls of so many older vehicles, where executives got 16 percent of the target overall. The company board had targets for adjusted earnings of $9 billion but it came in at $6.5 billion, meaning executives earned 17 percent of the 25 percent target, for example. Global market share was targeted for 11.7 percent and GM was 11.4 percent last year, meaning executives got 18 percent of that 25 percent target.
GM earned $2.8 billion overall last year.
No executives received an individual performance change for short-term compensation. GM said Chairman Tim Solso was not commenting.
"Ms. Barra neither sought nor did the compensation committee recommend an adjustment to the STIP (Short-Term Incentive Plan) awards for GM's named executive officers," according to the proxy.
No named GM executives received cash bonuses either last year, a year rocked by millions of recalled vehicles, including older cars with defective ignition switches now tied to at least 87 deaths.
Barra's pay also included $2.5 million in restricted stock awards and $7.5 million in performance stock awards that only vest if certain milestones are achieved. She also had a change in pension value worth $349,926 and other compensation totaling $412,532. That included items such as employer contributions to savings plans, life insurance, $189,936 for using chartered planes for personal travel (GM says its security policy doesn't allow her to fly commercially), security and the company vehicle program.
Barra earned $5.23 million in 2013 when she served as executive vice president of global product development, purchasing and supply chain for the company.
That compares to Ford Motor Co. President and CEO Mark Fields, who took over as CEO on July 1, earned $18.6 million in 2014. That was up from total compensation of $10.2 million in 2013 as Ford's chief operating officer.
Last year, Sergio Marchionne, Fiat Chrysler Automobiles CEO, earned 31.3 million euros ($38 million based on Dec. 31 exchange rate), according to an annual filing with the U.S. Securities and Exchange Commission. The majority of his compensation last year stemmed from a 24.7 million ($30 million) cash reward from non-executive directors.
The GM board compensation committee did award retention awards — paid in the form of restricted stock — to three executives last year to help ensure "consistency of management during the leadership transition period." Mark Reuss, GM's head of global product development, purchasing and supply chain, received 57,160 units, valued at about $2 million when they were granted last year; Michael Millikin, former general counsel, received 58,191, worth about $2 million and Karl-Thomas Neumann, executive vice president of GM Europe, received 27,587, worth about $1 million. Millikin's award vested at the end of 2014, while Reuss' and Neumann's will vest on the third anniversary of the day they were granted.
Reuss made a total of $9.48 million last year, while GM's Chief Financial Officer Chuck Stevens earned $4.89 million, GM President Dan Ammann made $8.49 million, Millikin earned $5.77 million and Neumann made $5.27 million.
Akerson, who remained a senior adviser to the company until July, earned a total of $2.1 million from GM last year. That included $850,000 in salary, $1.1 million in short-term cash incentives and $148,453 in other compensation. Akerson earned $9.1 million in 2013.
GM also said its annual shareholder's meeting is scheduled for 9:30 a.m. June 9 at GM's headquarters in the Renaissance Center in Detroit. Shareholders will vote on electing directors to the board; selecting its public accounting firm; advisory vote on executive compensation; and two stockholder proposals.