Magna executives see compensation soar as stock slips
GREG KEENAN

From Friday's Globe and Mail

March 27, 2008 at 7:28 PM EDT

Frank Stronach was paid $40.1-million (U.S.) last year as chairman of Magna International Inc. during a tumultuous year that included him giving up majority control over the company he founded in 1957 by selling a 42-per-cent stake to a Russian billionaire.

The value of Mr. Stronach's consulting contracts with various Magna subsidiaries rose 50 per cent in a year when the company's profit rose 25 per cent and its share price fell 15 per cent.

Bonuses for co-chief executive officers Don Walker and Siegfried Wolf rose by more than 90 per cent – doubling in the case of Mr. Wolf – and the value of restricted share units the company's senior executives received also soared.

Mark Hogan, who departed as president in November, will receive more than $12-million from Magna, with parts of a $3-million termination of employment being paid out monthly this year. The information is contained in the proxy circular for the company's annual meeting, which was filed with securities regulators yesterday.

“Among the significant factors the committee took into account in its 2007 review were: the substantial challenges facing senior management as Magna responds both to the rapid globalization of the automotive industry and the challenging operating environment; the implementation of the Russian strategy would pose challenges commensurate with the opportunities; the intense competition for experienced senior managers in the global automotive industry; and the need to provide competitive compensation,” the board's compensation committee stated.

Mr. Stronach earned the consulting fees through such activities as developing the Framework of Fairness Agreement with the Canadian Auto Workers union, identifying new chief operating officers and working on product innovation, the committee said.

Developing innovative products and technologies for customers will be crucial for the future of Magna, Mr. Stronach said in his annual message to shareholders in the company's annual report, filed with securities regulators yesterday.

“To achieve this goal, we are further involving our employees in a new program designed to bring forward innovative new ideas, with the objective of developing commercially successful new products,” Mr. Stronach said.

A new centre of innovation in North America will incubate new technologies and products that will be used by the company's manufacturing divisions, he said.

The circular noted that the value of $100 (Canadian) invested in Magna shares in 2002 was $115.80 as of the end of last year, compared with $133.70 a year earlier. The same amount invested in the TSX total return composite index was worth $231.90 at the end of last year.


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Stronach is the most overpaid CEO in Canada, by far.

What a scam.

   

I don't think he is the only one who made more as shareholders got less.

   

i don't disagree with that claim , he seems to be geting paid alot

   

With all this insider money, Frank Stronach thought he could put his daughter in charge of Canada, but she was not speaking French.

   

There probably is some connection between the Liberal party and Magna International....


part of the floor crossing deal

   

Yes insider money is buying political influence. Yes it will take a new political party to stop it.

   

New political party like this

   

the principal responsable for the higher income for CEOs are the board of directos whom r not independent

   

The CEOs are the principal responsable for their higher incomes since they choose the members on the compensation committees.