General Motors Co. (IW 1000/16) boosted compensation for CEO Mary Barra to $28.6 million in 2015 mostly using stock-based pay after a year in which the automaker posted record earnings but saw its share price languish.
Most of Barra’s pay is in stock or options. Only her salary of $1.75 million and a performance-based bonus of $3.06 million are paid in cash. GM met three of four targets in the bonus plan, leading to $12 million in stock awards for Barra as well as a special one-time grant of $11.2 million in options.
In Barra’s second year as CEO, GM capitalized on record auto sales in the U.S. and managed to sustain profits in China, where car sales stagnated last year. Her most stubborn challenge has been boosting GM’s stock price in a market where investors, wary that the U.S. car market may be done growing, have shunned auto stocks.
GM shares haven’t closed above the $33 price of its 2010 initial public offering since Jan. 4, and last year they fell 2.6 percent while the Standard & Poor’s 500 Index slid 0.7%. To align Barra’s compensation with the performance of the shares, GM issued the majority of her pay in stock and the one-time option grant. Those options vest over 4.6 years, giving her the right to buy shares for $31.32.
At yesterday’s closing price of $32.66 yesterday, each option would be worth $1.34 if they could be exercised.
GM also said Barra received $2.48 million from past equity awards that vested during 2015.
In 2014, Barra received $1.57 million in salary, a $2.07 million performance-based cash incentive and $11.8 million in stock awards, according to filings.
GM measures top executives on the company’s profitability, global market share, quality and automotive free cash flow. The largest U.S. automaker missed its global market share target and met or exceeded the others. As a result, Barra was paid 100% of her target cash bonus, which is equal to 175% of her salary.
President Dan Ammann made $11.8 million, of which $2.85 million was cash, and CFO Chuck Stevens was paid $8.1 million, of which $2.38 million was in cash.