Barrick Gold Cuts Thornton Pay 76% After Investor Criticismby
Compensation down to $3.1 million after forfeiting incentives
President Dushnisky's total pay declines 3.1% to $4.35 million
Barrick Gold Corp. awarded Executive Chairman John Thornton $3.08 million in total compensation, 76 percent less than last year, after he gave up his bonus in the wake of investor criticism of pay packages at the world’s largest gold producer.
Thornton, 62, received a salary of $2.5 million, $204,090 in other compensation and a pension value of $375,000, the Toronto-based miner said Thursday in a regulatory filing. Thornton forfeited $3.4 million of incentives for the year, the company said. The compensation compares with $12.9 million in 2014, which included $9.5 million of incentive pay.
Thornton “elected to forfeit all of the incentive compensation earned for 2015 in order to better reflect the experience of our shareholders last year,” Barrick said in the filing.
Barrick’s compensation and governance came under scrutiny after the company revealed in 2013 that Thornton, a former Goldman Sachs Group Inc. president, received an $11.9 million signing bonus. The company has already overhauled the way it determines senior executives’ pay, though last year it still drew the ire of three of Canada’s largest pension funds on executive pay and corporate governance.
Last month, Thornton said the company has responded by changing the way it pays executives.
“When we said last year we will fix this, we’ll fix it,” Thornton said in an interview in New York at the end of February. “In fact we have fixed it.”
According to the filing, Barrick President Kelvin Dushnisky was awarded $4.35 million in compensation for 2015, including a salary of $938,400, share-based awards of $1.58 million and $1.41 million in incentive compensation. The total is down 3.1 percent from 2014, when Dushnisky was awarded $4.48 million for sharing a co-president role with James Gowans.
Barrick has been working to reduce its debt, which swelled to as high as $15.8 billion in 2013, after the company expanded its footprint with the C$7.3 billion purchase in 2011 of copper producer Equinox Minerals Ltd. Since 2013, Barrick has cut assets, jobs and costs and adopted a decentralized managerial model more akin to a tech firm than a miner. Debt was down to $10 billion as of Dec. 31 and the company is looking to halve that in the “medium term.”
It’s “interesting” Thornton’s pay was lowered in a year when the company improved its performance, said Ken Hoffman, a senior industry analyst at Bloomberg Intelligence.
“He’s sort of saved the core of the company,” Hoffman said Thursday in an interview on Bloomberg TV Canada. “He’s reduced the debt load tremendously, he’s done some deals in order to sort-of reshape the corporation, and it’s been year to date the single-best performing major.”