Larry Culp could earn $ 47 million, or even $ 230 million in 2025, as the US conglomerate has laid off tens of thousands of workers in recent years.
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Brooke Sutherland, columnist for the opinion column of the Bloomberg agency, herself called it a “curious case”. Despite the serious difficulties in which General Electric (GE) has struggled for five years, and tens of thousands of job cuts, its CEO, Larry Culp, will receive a staggering bonus. “Curious”, indeed, because the board of directors has sharply reduced its requirements to keep a boss who has begun to raise the bar.
Mr. Culp would indeed have put his resignation in the balance, indicate several American media. In mid-August, when the Boston group shows new losses, in its aeronautics division this time, its contract was extended until 2024, with an additional option for an additional year. And his compensation plan revised upwards … by lowering the financial objectives that had been assigned to him when he arrived at GE in October 2018.
If the share reaches at least 10 dollars (instead of $ 19 previously) and stayed there for thirty days, he pocketed $ 47 million in stock options. It crossed the $ 10 threshold on Wall Street in November, and investment banks believe the financial health of the ailing colossus is improving. The former CEO of Danaher could even earn $ 230 million if the stock climbs to $ 17 (compared to $ 31 in the starting salary “package”) – a very achievable goal by 2025.
Refocused on three professions
The prospects for an exit from the health crisis opened up by vaccines against Covid-19, and a more frank economic recovery, should benefit GE , now refocused on three businesses: large equipment for power plants (turbines, networks, etc.), aircraft engines (LEAP manufactured with the French company Safran, among others) and renewable energies (onshore and offshore wind turbines). But the company still has great difficulties in generating large free cash flow and remains heavily in debt.
“It is scandalous, indignant Carl Kennebrew, chairman of the IUE-CWA, the union of GE employees. How can GE justify this kind of big bonus when workers, their families and communities suffer from job cuts and offshoring? “This money must, he said, to be “invested in GE’s US factories, our jobs”. Mr. Culp improved the financial situation, but thanks to numerous asset disposals and at a high social cost. In early May, the group announced 13,000 job cuts in aviation, and more are on the horizon.
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