Payouts at Leighton as heads roll
THE huge upheaval in the senior ranks at construction giant Leighton Holdings has left the company owing a raft of hefty termination payments, fuelling more ire from disgruntled investors and their scrutiny of the company's remuneration policies.
THE huge upheaval in the senior ranks at construction giant Leighton Holdings has left the company owing a raft of hefty termination payments, fuelling more ire from disgruntled investors and their scrutiny of the company's remuneration policies.Executive remuneration has long been a talking point for Leighton shareholders, with long-serving former chief executive Wal King consistently ranking among Australia's best-paid executives, pocketing a total salary package of $14.7 million last year before retiring at the start of this year after 23 years in the top job.Leighton's annual report, to be released next month, will detail Mr King's final package, which could reach $30 million including a $12.6 million termination payment.The board's decision this week to dump Mr King's successor, David Stewart, will also come at a cost - as will chairman David Mortimer's decision to quit.Under Mr Stewart's employment terms, he is entitled to receive a minimum of $3.4 million plus benefits, equivalent to one year's fixed remuneration and for complying with a two-year restraint period. He will also receive his share of any bonuses, though it is understood that most Leighton executives will not be entitled to most of their bonuses.There will also be seven-figure payouts for deputy chief executive, Bill Wild, and Thiess managing director, David Saxleby, who both left Leighton this year.For serving as a director for more than 10 years, Mr Mortimer will receive a one-off "retirement plan" payment equivalent to five years of his director fees, up to the point the plan stopped operating in 2008. This is expected to exceed $1 million.Corporate governance proxy advisers had criticised Mr King's remuneration as chief executive for being too heavy on short-term cash bonuses and too light on long-term equity-based incentives.Leighton have since resolved, starting with Mr Stewart, to incorporate a greater proportion of executive pay based on such longer-term share-based bonuses.It is believed new chief executive, Hamish Tyrwhitt, will be remunerated accordingly.