Heineken CEO Reward Too High

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No image available. (NL Times)

At the shareholders meeting of Heineken on Thursday, there was some commotion about the move of the Supervisory Board to grant CEO Jean-François van Boxmeer two extraordinary bonuses, one for his contributions to the acquisition of beverage group APB. 20 percent of the represented shareholders voted against the proposals, but at the end of the meeting Van Boxmeer was 4 million richer.

Van Boxmeer got a bonus of 2.5 million euro for the complex acquisition of APB and another so-called retention bonus of 1.5 million euro in shares, which should encourage him to remain with the company. The last reward he could only cash out after several years.

Among the shareholders who were against the rewards were the Dutch pension providers APG, PGGM and MN Services. Their spokesperson wondered why Van Boxmeer needed to be rewarded extra for an acquisition that fit within the strategy and therefore fell within the ordinary activities of a CEO. She also noted that whether the acquisition would be successful in the coming years was yet to be seen.

Besides these arguments, objections arose to the issuance of such high bonuses in these tough economic times. It was deemed "inappropriate, especially in this social context" to give a reward for nothing else than to keep somebody on the same position.

The Supervisory Board, however, noted the exceptional performance of the CEO in recent years, which not only increased profits, but also increased the price of Heineken shares significantly. The acquisition of APB was called "a historic milestone".