Glaxo to Pay First Woman CEO Less, Cites Lack of Experience | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Emma Walmsley, poised to take over as the first female chief executive officer of GlaxoSmithKline Plc, will earn about a quarter less than her predecessor Andrew Witty to reflect her lack of experience at the helm.

 

Walmsley will be paid an annual base salary of about 1 million pounds ($1.2 million), the London-based drugmaker said in its annual report. That compares to Witty’s pay of 1.15 million pounds last year. Her targeted bonus doesn’t exceed her salary, whereas Witty was given the opportunity to collect 125 percent of his pay through the bonus.

 

The lower compensation, for a woman who is breaking the gender barrier to become the first female to manage one of the world’s top 25 pharmaceutical companies, is likely to re-ignite a debate on the pay gap between the sexes. But it isn’t unusual that compensation levels change when a new CEO takes office as boards seek to link pay packages to the person’s level of experience and tenure.

 

“This is the moment to reassess the executive pay structure,” said Stefan Stern, director of the High Pay Centre, a think tank on top U.K. executive remuneration. “It’s good to focus on the contribution from the new person and it’s good to be tough and pay somebody less than their predecessor if their CV is at a different stage.”

 

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