J&J cuts bonuses for execs
TRENTON, N.J. (AP) -- Citing "disappointments" last year, Johnson & Johnson has lowered planned bonuses by 10 percent for new CEO Alex Gorsky and other top executives.
The giant health products maker called its 2012 results a "mix of short-term successes and disappointments," with the latter including slow sales growth, a still-tarnished reputation and failure to get many of its recalled consumer health products back into stores as quickly as hoped.
Still, Gorsky received total compensation worth $8.93 million, up about 62 percent from the $5.52 million total he received in 2011, based on the company's annual proxy statement filed Wednesday. Gorsky, a former Army captain with an MBA from the University of Pennsylvania's Wharton School, was promoted from vice chairman to chief executive last April 26 and became chairman in December.
In 2012, he received salary totaling $1.09 million, cash incentives of $3.41 million, stock awards worth $2.79 million, option awards worth $1.48 million and other compensation of $159,774. The last category includes about $49,000 in pension contributions, $7,000 for tax reimbursements related to transportation costs of relatives traveling with Gorsky, and about $98,000 for a car and driver for Gorsky, his personal use of corporate aircraft and his home security system.
Gorsky's predecessor, Bill Weldon, received total compensation of about $26.6 million last year, up from about $23.4 million in 2011.
Since September 2009, J&J has issued about three dozen product recalls -- covering hip implants, contact lenses, prescription drugs and over-the-counter medicines such as Tylenol, Motrin and Rolaids. Lost product sales and expensive factory upgrades have cost J&J well over $1 billion, and it's operating under increased scrutiny by U.S. regulators.
The company, which frequently pledges allegiance to its credo of putting patients, medical providers and employees ahead of profits, conceded its reputation isn't completely restored.