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BAe chief nets pounds 3.5m, with a bonus to come three decks

Success or not, for some industry leaders the rewards just keep pouring in

Michael Harrison
Friday 27 March 1998 19:02 EST
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SIR Dick Evans, the chief executive of British Aerospace, received a pay package worth pounds 3.5m last year and is in line for a 75 per cent increase in bonus entitlements in the current year.

BAe's annual report and accounts shows Sir Dick's total pay, including pension contributions, rose from pounds 568,456 in 1996 to pounds 727,879 - an increase of 28 per cent. In addition, he made a gain of pounds 2.25m by cashing in share options and received shares under BAe's long term performance plan worth a further pounds 450,000. These shares cannot released until next year.

The accounts also show Robert Kirk, head of BAe's North American operations, retired with a package worth pounds 4.5m after cashing in options in BAe and a subsidiary.

The bonus schemes, under which executive directors can earn 100 per cent of their base salaries, are being amended so that the maximum entitlement will be 175 per cent.

Under the old scheme the maximum annual bonus payable is being raised from 40 per cent to 75 per cent while the awards available in the performance share plan are increasing from 60 per cent to 100 per cent of base salary.

The number of matching shares available when the annual bonus is taken in the form of shares is also being increased, from 20 per cent to 50 per cent.

Sir Robin Biggam, BAe's remuneration committee chairman, said performance targets that triggered the increased awards were also being made tougher. BAe will seek shareholder approval for the changes at the annual meeting on 29 April.

So far a total of 150,000 shares with a market value of pounds 3m have been granted under the performance share plan.

Roy Gardner, chief executive of Centrica, the trading arm of British Gas, was paid pounds 493,000 last year. This compares with pounds 339,000 in 1996, before the demerger of British Gas, when he was finance director and then chief executive designate of Centrica. He is also sitting on 1.3m share options showing a pounds 428,000 profit and has a notional allocation of 1.23m shares under Centrica's long term incentive scheme.

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