Citigroup has revamped its pay plans for top executives after shareholders voted down overly generous proposals last year.
Executive pay plans will now have tighter links to company performance, says the firm in a regulatory filing, adding that it will pay new CEO Mike Corbat $11.5 mn for his work in 2012, putting his compensation in line with peers at other big banks.
The changes, which affect only a small number of executives, come less than a year after 55 percent of shareholders voted against the group’s previous remuneration plans in a non-binding vote, rejecting the $15 mn pay package for then chief executive Vikram Pandit.
The Dodd-Frank Act in the US requires companies to hold a non-binding vote on executive pay at least once every three years.
Last week, Citigroup chairman Michael O’Neill and other directors met with shareholders representing more than 30 percent of the company’s stock to hash out the new plan, according to the filing. ‘When our shareholders spoke last year about Citi’s compensation structure, we listened,’ O’Neill says in the filing.
The new plan will see 30 percent of top bonuses paid in cash based on assets and total shareholder return compared with peers over a three-year period. Two-fifths will be a straightforward cash bonus and the final 30 percent will come in the form of deferred stock.
Corbat’s pay is based on his performance as CEO – a position he was appointed to in October last year – and in his previous role as head of the Europe, Middle East and Africa region, the company says.
