Newly revealed documents show that Stephen Elop, former CEO of Nokia, received an even bigger payoff than anticipated following the sale of the Finnish company’s devices business to Microsoft – with the original payment having been the source of significant criticism.
According to Nokia’s 2013 Annual Report, Elop received a severance payment of €24.2 million, made up of a base salary and management incentives of €4.1 million, and equity awards of €20.1 million. As previously detailed, 70 per cent of this is being picked-up by Microsoft, with the remaining 30 per cent (€7.3 million) from Nokia.
It was previously reported that the executive would get a pay-off of around €19 million, after three years at the helm of the struggling devices and infrastructure player. It is believed the uplift has come due to the improvement in Nokia’s share price in the interim, as Microsoft agreed to take the loss-making devices unit off its hands.
When the original pay-off was revealed, it was described as “outrageous” by Finnish politicians, due to Nokia’s continued poor financial performance with Elop at the helm. The Financial Times noted that under his rule, the company’s market capitalisation fell to €11 billion from €17 billion, with operating profit shrinking by 70 per cent over the three years.
The Annual Report also shows that Rajeev Suri, president and CEO of the new-look Nokia, is in line for a salary of €1 million per year, with a short-term cash incentive plan of 125 per cent of base salary.