General Motors Company (NYSE:GM) CEO, Mary Barra, earned more than $16.2 million in her first year at the helm of US’s largest car company. Barra was appointed to the top job in January 2014. Mary Barra had received accolades for her leadership of GM through a recall scandal in 2014, and it turns out she was well compensated for it as well. She received 80% more than the $9 million compensation received by her predecessor, Dan Akerson.
Barra was allocated a base salary of $1.6 million and awarded stock awards of over $13.7 million which can be encashed only after many years. She didn’t receive a cash bonus just like all of other GM’s executives. Her compensation is 290 fold the amount earned by a worker having the union’s top wage.
Barra delivered more than an internal compensation target. According to GM, she could have made more money if other performance targets were achieved.
She had a turbulent year in the job as the company was faced with a recall crisis costing it over $4 billion. Barra apologized on more than one occasion for the lapse of GM executives not recalling for ten years of automobiles with a defective ignition switch. The defect is now held responsible for at least 87 people dying.
She put up a $500 million compensation fund for the affected and their families. Barra requested an independent investigation into what she dubbed a “fundamental failure” in not recalling the defective cars earlier. That investigation resulted in the firing of 15 executives.
Cindy Estrada, the vice-president of the United Auto Workers union, opined that UAW members had toiled to make the new GM the prosperous company it is currently.
General Motors Company (NYSE:GM) was forced to recall 2.6m cars as a result of the ignition switch issue, which cost $2.8 billion. Last week a judge ruled that GM would not have to confront loads of lawsuits accusing the company of concealing the ignition switch defect ahead of its bankruptcy.
