Pearson CEO, CFO Won't Get Pay Rise for Second Year
March 24 2017 - 9:56AM
Dow Jones News
By Ian Walker
LONDON--Pearson PLC (PSON.LN) won't be giving Chief Executive
John Fallon or Chief Financial Officer Coram Williams a pay rise in
2017, for the second year in a row, and they will both have their
annual incentive plan funding lowered, according to the company's
annual accounts published Friday.
The education publishing company said that while the CEO's pay
was "substantially" behind the market standard, the remuneration
committee concluded this wasn't relevant in the current trading
environment.
In February, the company reported posted a pretax loss for 2016
and a 12% fall in its headline operating profit, which was at the
lower end of guidance. Trading was hit by a fall in its biggest
market, U.S. higher education courseware.
Mr. Fallon's AIP funding has been cut to 44% of base salary from
55%, while Mr. Williams' has been lowered to 37% from 47%,
Pearson's remuneration committee chairman, Elizabeth Corley,
said.
"In the current trading environment the committee has exercised
its discretion to reduce incentive payment payouts. We remain
focused on the need to reflect on shareholder experience in
compensation decisions, while at the same time recognising when
there is genuinely strong delivery against stretching and demanding
performance targets," Ms. Corley said.
"Pearson is undergoing substantial change as the company
delivers on digital transformation and continuously improving
efficiency, while at the same time meeting the needs of all our
stakeholders. This requires strong and resilient leadership and our
policy proposals are designed to provide the appropriate balance of
reward for performance and accountability," she added.
For the year ended Dec. 31, Pearson made a pretax loss of 2.56
billion pounds ($3.2 billion), compared with a loss of GBP433
million in 2015. Revenue rose to GBP4.55 billion from GBP4.47
billion, but fell 8% in underlying terms.
Adjusted operating profit, which strips out exceptional and
other one-off items, fell to GBP635 million from GBP672 million in
2015.
-Write to Ian Walker at ian.walker@wsj.com; @IanWalk40289749
(END) Dow Jones Newswires
March 24, 2017 09:41 ET (13:41 GMT)
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