Prudential paid outgoing chief executive Tidjane Thiam £11.8m in 2014, a 35 per cent increase on his 2013 compensation, following a bumper incentive plan payout in his final year in charge.
Thiam, who is leaving the dual-listed insurer to join Credit Suisse in May, was awarded £8.25m as part of the company’s three-year LTIP and earned a £2.12m bonus for his performance last year, Prudential’s annual report showed.
Mike Wells, head of Prudential’s US business – and the executive most widely tipped to succeed Thiam – was the company’s second highest paid board member, earning total compensation of £11.39m.
Prudential said one employee earned around £15.4m last year but it did not name the individual as they do not sit on the company board.
A company spokesman declined to comment on a Sky News report that the top earner was M&G Investments fund manager Richard Woolnough, who runs the M&G Optimal Income Fund, the M&G Corporate Bond Fund and the M&G Strategic Bond Fund, three of the company’s flagship fixed interest funds.
All executive directors received a 2015 salary increase of 3 per cent in line with those awarded to other group employees. The company said it would also increase the fee paid to chairman Paul Manduca by 16.6 per cent to £700,000 from July, in recognition of the “increased demands” of his role.
Like several other financial institutions and asset management firms, Prudential has announced plans to apply ‘clawback’ provisions to executive bonuses from 2015.
Prudential also said future executive bonus awards would reflect achievement of internally set “economic capital targets”, as Europe’s insurance sector prepares for the implementation of new EU capital adequacy rules known as Solvency II.
Prudential justified the pay rises by saying in the annual report that total shareholder return since December 2008 has increased 413 per cent, compared to 120 per cent for unspecified ‘international insurers’ and 91 per cent for the FTSE 100.