Immelt got $8.11 million for tumultuous final months at GEBy ANDERS MELIN and RICHARD CLOUGH
March 13. 2018 11:53PM
Jeffrey Immelt received $8.11 million in compensation for his final months running General Electric even as it stumbled through one of the most tumultuous stretches in its 126-year history.
The former chief executive officer and chairman received $2.86 million in salary during 2017, GE said in a regulatory filing Monday. Immelt, 62, who stepped down as the top executive in August and from the board two months later, also got $1.87 million in perks, mostly relocation benefits. The remaining $3.37 million reflected a change in the value of his pension and deferred compensation.
While GE had started to show signs of stress early last year, the company fell hard in the months after Immelt’s exit. New CEO John Flannery slashed the dividend, replaced many top managers and announced deep cost cuts to help deal with cash-flow shortfalls and flagging demand for gas turbines, locomotives and other industrial equipment. GE was the worst performing stock in the Dow Jones Industrial Average in 2017, plunging 45 percent and losing $125 billion in market value.
GE’s troubles have continued in 2018. The Boston-based company, which employs about 800 people at its jet engine plant in Hooksett, N.H., is under investigation by the Securities and Exchange Commission over its past accounting practices and has the biggest pension shortfall among major U.S. public companies.
“The last year has been a difficult one for GE’s shareowners, and no one is more disappointed in our results than” the board, Jack Brennan, GE’s lead director, said in the filing. Senior leaders, including the current and former CEOs, chief financial officer and general counsel, didn’t receive a bonus in 2017 — the first time that’s happened in GE’s history, he said.
Immelt, who led GE for 16 years, exited with benefits and deferred shares worth about $100 million, according to data compiled by Bloomberg. That included a pension of roughly $84 million and about $10 million in deferred compensation. He was recently named chairman of Athenahealth Inc.
Flannery, 56, the former head of GE Healthcare who took over as CEO on Aug. 1, got $9 million for 2017, including $1.74 million in salary, stock options valued at $2.08 million and a $3.26 million adjustment to the value of his pension and deferred compensation.
His pay was 157 times higher than that of GE’s median employee, which the company identified as a GE Healthcare worker in Germany who made $57,211. The disclosure is part of a broader federal rule change requiring public companies to reveal how CEO compensation stacks up against that of the company’s employees.