GSK cuts CEO's bonus some 12 percent due to China scandal
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Research Triangle Park, N.C. — GlaxoSmithKline Chief Executive Officer Andrew Witty received a bonus less than the maximum possible because of a Chinese investigation into bribery allegations against the company.
Witty’s bonus of 1.88 million pounds ($3.13 million) was some 12 percent lower than the potential 2.12 million pounds ($3.75 million) he might have gotten, Glaxo said Thursday in its annual report.
Even so, the bonus was more than double the amount awarded for 2012 after the company won regulatory approval of six products last year.
China began an anti-corruption probe focused on London-based Glaxo (NYSE: GSK) in July. Allegations by China’s government that Glaxo bribed hospitals, doctors and officials contributed to a plunge in revenue from that country and a hit to its corporate image.
“Both Sir Andrew and the board are mindful of the impact this issue has had on the reputation of the company,” Tom de Swaan, chairman of the board’s remuneration committee, said in a statement in the report. “As a result, the bonuses awarded for 2013 were lower than they otherwise might have been.”
Earlier this month, Glaxo forecast revenue will rise by about 2 percent this year as the company introduces the newly approved medicines.
“Andrew Witty’s bonus reflects GSK’s very strong performance in 2013, which included receiving the highest number of product approvals of any company, meeting the top end of our financial guidance and delivering the best total shareholder return since the formation of the company with more than 5 billion pounds returned to shareholders,” Glaxo spokesman Simon Steel said in an email.
[GSK operates its North American headquarters in RTP.]
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