Ahold Chairman Quits, C.E.O. Takes Pay Cut
AMSTERDAM -- Dutch group Ahold's nonexecutive chairman will quit and its chief executive take a cut in guaranteed pay as the world's third-largest food retailer responds to investor outrage over an accounting scandal and excessive salaries.
Ahold said on Wednesday supervisory board chairman Henny de Ruiter would resign at a shareholders meeting likely to be held in October. The group also said c.e.o. Anders Moberg would give up his guaranteed severance pay and link his hitherto fixed bonus pay to his performance. Ahold is trying to restore its credibility and repair tattered finances after discovering a 1 billion-euro (US $1.12 billion) accounting hole in its books in February.
Karel Vuursteen, a former head of Dutch brewer Heineken, is slated to succeed De Ruiter as head of the supervisory, or nonexecutive, board.
Investors have called for the board to take responsibility for the huge accounting irregularities that emerged under its tenure. The board's approval earlier this month of Moberg's multimillion-euro pay package caused further outrage.
A highly placed person close to the supervisory board said Vuursteen and Philips' Finance director Jan Hommen, the last appointed board member, are the only ones who will stay on. "There is a realization they were all on board when the scandal took place, and during the expansion policy that has now been reversed. It is better to indicate to the outside world that they take their bit of the blame," the source told Reuters.
The Dutch VEB shareholder association on Tuesday called for the resignation of most of the supervisory board.
Moberg, the Swedish former boss of furniture chain IKEA, said in a statement on Wednesday that he had been concerned by the debate over his remuneration and would surrender part of his controversial package. "I have listened to the criticism and am aware of its negative impact on the company and its associates, and I would like to respond," he said. Moberg said he has relinquished his guaranteed severance pay and that his bonus will be fully performance-related with no guaranteed elements.
Previously Moberg was supposed to get a base salary of 1.5 million euros a year, a guaranteed bonus of 1.5 million euros in the first two years, extra bonuses, stock options, and shares that could lift the total above 10 million euros. His exit package had also previously provided for 2.5 times his annual salary and double the average bonus received over the preceding two years.
Ahold said further changes to the supervisory board would be made at the annual general meeting likely in May in 2004. "The supervisory board now believes that a predominantly new team should assist Ahold in shaping its future," it said.
Ahold said on Wednesday supervisory board chairman Henny de Ruiter would resign at a shareholders meeting likely to be held in October. The group also said c.e.o. Anders Moberg would give up his guaranteed severance pay and link his hitherto fixed bonus pay to his performance. Ahold is trying to restore its credibility and repair tattered finances after discovering a 1 billion-euro (US $1.12 billion) accounting hole in its books in February.
Karel Vuursteen, a former head of Dutch brewer Heineken, is slated to succeed De Ruiter as head of the supervisory, or nonexecutive, board.
Investors have called for the board to take responsibility for the huge accounting irregularities that emerged under its tenure. The board's approval earlier this month of Moberg's multimillion-euro pay package caused further outrage.
A highly placed person close to the supervisory board said Vuursteen and Philips' Finance director Jan Hommen, the last appointed board member, are the only ones who will stay on. "There is a realization they were all on board when the scandal took place, and during the expansion policy that has now been reversed. It is better to indicate to the outside world that they take their bit of the blame," the source told Reuters.
The Dutch VEB shareholder association on Tuesday called for the resignation of most of the supervisory board.
Moberg, the Swedish former boss of furniture chain IKEA, said in a statement on Wednesday that he had been concerned by the debate over his remuneration and would surrender part of his controversial package. "I have listened to the criticism and am aware of its negative impact on the company and its associates, and I would like to respond," he said. Moberg said he has relinquished his guaranteed severance pay and that his bonus will be fully performance-related with no guaranteed elements.
Previously Moberg was supposed to get a base salary of 1.5 million euros a year, a guaranteed bonus of 1.5 million euros in the first two years, extra bonuses, stock options, and shares that could lift the total above 10 million euros. His exit package had also previously provided for 2.5 times his annual salary and double the average bonus received over the preceding two years.
Ahold said further changes to the supervisory board would be made at the annual general meeting likely in May in 2004. "The supervisory board now believes that a predominantly new team should assist Ahold in shaping its future," it said.