In the past, AstraZeneca’s investors have hit out at the company for executive compensation they deemed over-the-top. And they may have something to say about CEO Pascal Soriot’s £11.36 million ($14.93 million) in total pay last year, a 9% jump from 2017.
Soriot’s fixed pay came in at £1.78 million last year, including taxable benefits and pension allowance. His bonus totaled £1.86 million, and his long-term incentive pay accounted for another £7.67 million. For the first time, AZ also released its CEO-to-worker pay ratio, disclosing that Soriot made 160 times the average AZ employee’s salary last year, according to its annual report (PDF).
While AZ says Soriot earned his pay in numerous ways last year, investors may be uneasy about the raise. Soriot’s pay has irked some investors in recent years amid a tough stretch at the company.
In 2017, the helmsman pulled in £9.4 million ($12.7 million) in total pay, a 34% reduction from the year before. Even after his pay cut, the proxy advisory firm Institutional Shareholder Services urged shareholders to vote against the remuneration report. ISS argued Soriot’s bonus was too high considering AZ’s performance.
Days later, 35% of investors voted against the pay package. It was a “say on pay” poll rather than a binding vote. ISS didn’t immediately respond to a request for comment on Soriot’s 2018 pay.
Now, though, in 2018, AZ says it “turned the corner and returned to product sales growth” under Soriot’s leadership. The company says the CEO has implemented a “focus on the innovative science and investment necessary to deliver a new generation of medicines for patients, with a rebuilt and sustainable pipeline.” Sales grew 4% last year, but core operating profit sank 17% and core earnings per share fell 19%.
Soriot also demonstrated “exceptional leadership” elsewhere during the year, AZ says, such as in meetings with world leaders in China, Russia, France, Germany and the U.K.
If AZ investors have issues with Soriot’s pay package, they’re not alone. The CEO himself isn’t exactly happy with the situation, either. Last fall, he told The Times he was among the lowest-paid pharma executives, adding that he was right to fend off Pfizer’s 2014 takeover attempt.
Now, with AZ moving forward and launching promising new meds, he may be right about the Pfizer bid. Still, the company is still far short of its stated goal of $45 billion in sales by 2023, which Soriot laid out to help block the buyout.
Mar 5, 2019