THE Co-operative is to hand a £3.6m pay deal to its chief executive, despite facing a £2bn loss after the biggest crisis in its history.
The mutual argues that Euan Sutherland’s proposed remuneration package will be in line with comparable firms and reflects the scale of the task he faces.
But the pay award comes at a time when the group is facing large-scale job cuts after a disastrous year in which its banking arm needed rescuing due to a £1.5bn hole in its balance sheet.
According to the Observer, Mr Sutherland will receive a base salary of £1.5m this year, plus a £1.5m retention payment.
He joined the company in May last year, having been chief operating officer of B&Q owner Kingfisher.
With pension contributions and compensation for buying him out of his previous contract, he will receive £3.66m this year.
His predecessor, Peter Marks, who lives near Bradford, received just over £1.3m last year.
Richard Pennycook, the chief operating officer and former finance director at Morrisons, will receive a £900,000 salary and a retention payment of £900,000. Six other executives will be paid salaries between £500,000 and £650,000 – and the same amount in retention.
The group is reportedly set to announce losses of £2bn later this month, having seen its banking arm fall under the control of bondholders.
Ursula Lidbetter, chairwoman of the Co-operative Group, said the business had just faced the biggest crisis in its 150-year history. She added: “We saved the bank, without recourse to the taxpayer.”