Credit: Kamil Pietrzak via Unsplash
John Wren, the 73-year-old CEO of Omnicom, agreed to a new salary package with a base salary of $1 a year, down from $1 million.
It’s part of a deal, whose details are now being picked apart, which could deliver him tens of millions of dollars.
This puts him in a class of his own when it comes to salary. His package for 2025 is valued at almost $US70 million.
The $1 is just a symbol of employment. He’s been CEO since 1997 and most likely has built enough assets not to worry too much about household bills being covered by a monthly pay cheque.
This chart, based on data provided by executive intelligence company Equilar, compares salary packages of CEOs at global advertising companies.
The median salary at Omnicom is $US57,300.
In a vote by shareholders, 43% went against Wren’s new package, and that of other executives.
But the board of directors at Omnicom, now the world’s biggest advertising group after absorbing IPG, can, if they wish, ignore the four out of ten who didn’t like this change in pay.
“One of the overarching goals of our compensation program is to motivate and retain talented executives critical to the long-term success of Omnicom,” the compensation committee wrote.
“At this pivotal time in our company’s growth and evolution, the compensation committee and full board understood the strategic importance of ensuring Mr Wren’s continued leadership through this period of unprecedented transformational change, integration and opportunity, and determined to enter into an amended and restated employment agreement.”
Wren has agreed to extend his employment as Omnicom’s chairman and CEO until the end of 2028, at which point he would continue as executive chairman when a CEO successor is found.
Wren gets a “special award” of stock options. He will forgo any other cash, apart from a $1 each year, or equity incentive compensation through the end of 2028.
“These changes are intended to drive long-term shareholder value creation and, as a result, his incentive compensation will be completely at-risk and dependent on Omnicom’s future stock price,” the committee said.
Wren has been granted an option to purchase 4,000,000 shares of Omnicom at an exercise price equal to the per share closing price on the date of grant ($77.60).
Wren won’t get any value from the stock option unless the per-share price of Omnicom’s common stock increases above $77.60. The shares closed overnight in New York at $74.43.
Before the takeover of IPG, the Omnicom share price was touching $US100.
Wren’s average target total direct compensation previously, over the three years 2022-2024, was $US20.9 million.
The CEO compensation detail via Equilar:
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