Morgan Stanley’s outgoing finance chief Ruth Porat said she was ‘delighted to be returning to [her] California roots’ this week, as she accepted a job as Google’s CFO. We’ll bet she was. Google’s paying her a colossal $70m (£47m) package over the next two years. Anyone would think it had $50bn in cash just lying around or something.
Porat’s actual wage will only be $650,000, which pales in comparison with the $30m golden hello she’s getting this year and the $40m stock grant she’ll pick up next year. Talk about incentive pay…
It’s an impressive amount for two years’ labour, but how does it compare with some of Britain’s best? Carolyn McCall turns heads every year when EasyJet publishes its fiendishly complicated bonus pay outs. The airline’s boss got a £7.7m payday in 2014, many would say deservedly since the firm’s profits rose 22% for the year.
TUI Travel paid its boss Peter Long nearly £15m in 2014, as performance related share options vested, while WPP’s Sir Martin Sorrell took home a whopping £36m through a similar scheme. Very impressive, but not quite Google.
Perhaps the only way British bosses can compete with these cash rich American giants is when they own the company, and are thus able to pay themselves dividends. Arcadia founder Sir Philip Green famously paid his family a £1.2bn dividend in 2005. Try finding a bonus that big in Silicon Valley.