Prudential boss Thiam handed £7.8m pay deal


The payout followed criticism from the outgoing Financial Services Authority that it had been kept in the dark on the ultimately abortive £23 billion takeover bid Thiam led for AIG’s Asian subsidiary, AIA, three years ago.
The FSA, which did not learn about the proposed transformational acquisition by the company until it leaked into the media, said it meant it was forced to consider a highly complex transaction in a short time.
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Hide AdTracey McDermott, the FSA’s director of enforcement and financial crime, said: “Prudential, led by Thiam as chief executive, failed to give due consideration to its obligation to inform the FSA of this transaction, which would have had a huge impact on the group had it gone through. That was a serious error of judgment for which Prudential is paying the price.”
The company’s annual report showed that Thiam received a £2m bonus in cash and shares, a £1m salary, and a £4.4m long-term incentive plan was also activated. He was also handed £250,000 for his pension pot.
That compared with Thiam’s remuneration of £4.7m in 2011, including a salary of £900,000 and a bonus of £1.6m.
Thiam’s step-change in pay in 2012 raised some eyebrows in the City. Corporate governance group PIRC said: “One thing we would say is we would expect the Prudential’s remuneration committee to look at the case for clawing back some of Thiam’s previous awards. After all the company has just been fined by the regulator and he [has been]personally censured.”
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Hide AdHowever, it is thought unlikely institutional shareholders will kick up a storm about the latest awards. Prudential’s share price has doubled under Thiam’s tenure, and the group posted profits for 2012 up 25 per cent at £2.5bn, alongside a 16 per cent jump in the total dividend.