Former AMP Capital chief Boe Pahari pockets a nice profit share for less than 2 months’ work, while other staff cop a pay rise freeze.
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Demoted AMP Ltd (ASX: AMP) executive Boe Pahari was paid close to a $1 million bonus for running AMP Capital for all of 53 days.
The disclosure was made Wednesday in the company’s annual report.
The report stated Pahari was a beneficiary of the AMP Capital Enterprise Profit Share (EPS) plan for his role as global head of infrastructure equity and the northwest region.
“The prorated amount of the EPS award was $937,724 for the time during which he was the chief executive, AMP Capital.”
Why was Pahari only in the position for 53 days?
Pahari was promoted to AMP Capital chief on 1 July last year.
But in August explosive details of sexual harassment allegations made against him were publicly revealed.
This included Pahari sending the female subordinate on a gratuitous trip to the UK, then allegedly saying she made him look like a “limp dick” when she refused his offer to buy her clothing.
He was also accused of extending her accommodation against her wishes then suggesting they communicate on Whatsapp to avoid scrutiny.
AMP’s share price tanked as investors called for Pahari’s head.
The company initially defended the promotion. But the subsequent pressure became too much to bear and Pahari was demoted back on 23 August — after just 53 days in the position.
Chair David Murray and board member John Fraser also exited that day.
AMP staff outraged about Pahari’s bonus
AMP shareholders have seen the stock price tumble from $5.43 just 3 years ago to now $1.46.
But it seems they might not be the only ones wondering about the generous bonus to Pahari.
According to AFR.com, a staff town hall meeting on Wednesday went haywire with employees complaining about the generosity to the executive.
After a tough 2020, the financial services giant had put on a pay rise freeze and is currently seeking to cut 20% of its workforce while it sells off a part of the business to a US buyer.
AMP also released its annual sustainability report on Wednesday, which confirmed the Pahari scandal had an impact on the workforce.
“In the second half, disclosure of workplace conduct and consequence management issues had a negative impact on engagement which increased talent risk for AMP.”
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Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.