GSK investors attack exec pay, performance

It's been a tough week for outgoing GlaxoSmithKline CEO Jean-Pierre Garnier. Browbeaten during a BBC interview on Tuesday, he was "heckled" by annoyed shareholders at yesterday's annual meeting. Investors complained about the stock's lackluster performance and rebelled against what they called excessive executive pay. At least Garnier's pain was shared by the company's board: "I am getting fed up with this underperformance," one shareholder said to applause. "This board is a continuing failure."

One paycheck at issue was Chris Viehbacher's one-time retention bonus, a stock award worth between $4 million and $5 million. Viehbacher, you'll recall, was in the running to replace Garnier, but lost out to incoming chief Andrew Witty. One of GSK's big investors questioned the bonus, saying it had "insufficient justification." (It's worth noting, however, that the other CEO hopeful, David Stout, left GSK after Witty was appointed.)

Investors criticized other exec's pay, too, saying it's not sufficiently linked to the company's stock performance. Only 61 percent of shareholders voted in favor; considering the usual rubber-stamp shareholder vote, that's a low percentage. Last year, GSK's pay plan got 92.5 percent of the vote.

Perhaps Garnier was simply taking out his frustrations on a handy target when he scoffed at the idea of GSK buying rival AstraZeneca. "What kind of future do they have?" he asked. "What kind of pipeline do they have? Why would you trade down?"

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