GlaxoSmithKline unveil revised executive wages

Pharmaceuticals giant GlaxoSmithKline today bowed to shareholder pressure and unveiled revised pay and rewards contracts for executives.

It scrapped the two-year rolling contracts for executive directors that had sparked investor anger earlier this year over “fat cat” pay, replacing them with a single year deal without compensation.

Links between pay and performance were strengthened while salaries were also aligned with other major international pharmaceutical companies.

The revised pay policy comes seven months after Glaxo suffered an unprecedented defeat at its annual general meeting when shareholders voted against a multi-million pound pay and rewards package for executives.

A controversial “golden parachute” deal for chief executive Jean-Pierre Garnier caused a storm, which saw one of the biggest shareholder revolts against “fat cat” pay in British corporate history.

Glaxo said today it had held extensive consultation with major shareholders, the Association of British Insurers and the National Association of Pension Funds before finalising the new pay arrangements.

Chairman Christopher Hogg said: “The new policy is clear and unambiguous and will be operated consistently. No other pharmaceutical company has adopted such demanding performance criteria.”