YOKOHAMA, Japan (Reuters) - Carlos Ghosn, chief executive of Nissan Motor Co (7201.T), told shareholders on Tuesday he was paid a salary and bonus of 987 million yen ($12.5 million) for the past fiscal year, a package that makes him Japan’s highest-paid executive.
Ghosn has led Nissan since 2001 and steered the automaker through a turbulent 2011 that saw it bounce back faster than its domestic rivals Toyota Motor Corp(7203.T) and Honda Motor Co(7267.T) from disruptions caused by the March 2011 earthquake and tsunami in Japan.
Although Ghosn’s 0.5 percent pay rise for the past year put him just short of becoming the first CEO of a Japanese company to be paid more than 1 billion yen, investors have been far more concerned with his tenure than the terms of his compensation.
Nissan has justified the higher pay for Ghosn and other Nissan executives by saying they should be compared to compensation packages for CEOs at other big, global industrial companies including Ford Motor Co (F.N) and Volkswagen AG (VOWG_p.DE), rather than the lower pay for Japanese CEOs who tend to have come up through the ranks over a career.
“Recruiting and retaining these best and brightest is a competitive advantage that we cannot afford to lose,” Ghosn told an annual shareholders’ meeting in Yokohama.
The disclosed compensation for Ghosn does not include stock options he was granted in the Japanese automaker. Those will be disclosed later this week, a spokesman said.
The tally also does not include his compensation as head of Nissan’s alliance partner, Renault SA (RENA.PA).
Nissan said its board had weighed cash compensation for Ghosn against pay for CEOs at other major industrial companies with global operations based on advice from consulting firm Towers Watson.
Nissan said the average CEO pay at the industrial companies it had used as a benchmark was $16.1 million, while the average CEO pay for global automakers was $17.5 million.
That average included the $29 million paid to Ford CEO Alan Mulally and the $23 million paid to VW’s Martin Winterkorn.
Ghosn made another 1.2 million euros ($1.7 million) for heading Renault in 2010. A comparable number for 2011 was not immediately available.
Ghosn’s pay at Nissan has topped that of his counterparts at Toyota and Honda by a wide margin. Toyota President Akio Toyoda received 136 million yen ($1.71 million) for the past fiscal year, unchanged from a year earlier.
In another point of comparison, Ghosn’s pay topped the total compensation for the 21 most senior executives at Sony Corp (6758.T), another Japanese company that had been headed by a foreign CEO.
Sony has asked its shareholders to approve payments of just over $10 million for its top executives including newly-appointed CEO Kazuo Hirai, who took over from Howard Stringer.
Ghosn, 58, told Reuters on Friday that he was not planning to step down from his post anytime soon, following a Bloomberg report that he would retire before the automaker’s next business plan starts in about five years.
Reporting by Yoko Kubota, Writing by Kevin Krolicki; Editing by Chang-Ran Kim and Eric Meijer