PG&E Considers Boosting New Director Pay to $400,000
(Bloomberg) -- PG&E Corp. is considering offering new board members significantly higher compensation than existing directors as the bankrupt utility giant seeks to recruit directors, according to people familiar with the matter.
The parent of California's largest utility -- which filed for bankruptcy in January -- may offer incoming directors as much as $400,000 annually, said the people, who asked not to be identified because the matter isn't public. The median PG&E director compensation was $271,000 in 2017, according to data compiled by Bloomberg.
No decision has been made, and PG&E could opt to not offer more pay to new directors, the people said. Any increase in board compensation would also have to be disclosed to regulators, one of the people said.
PG&E would like to raise new director pay to reflect how the role would require a greater time commitment than the typical utility board seat, the people said. PG&E is working with executive recruiter Spencer Stuart to find board candidates, they said.
PG&E's search requirements for directors include evidence of ties to California, regulatory experience and a grasp of energy markets, the people said.
Representatives for PG&E and Spencer Stuart declined to comment.
It's common for companies going through bankruptcy to ask a judge to pass new bonus programs for executives, or boost director pay, because figuring out how to salvage a company is hard.
Employee compensation already has come under the microscope in PG&E's bankruptcy. Attorneys for wildfire victims asked the bankruptcy judge to reject PG&E's request to pay $130 million in bonuses to hundreds of workers. PG&E's board then reversed course and decided not to award the payouts due to the bankruptcy, drawing the ire of its labor unions.
Management Overhaul
PG&E has been negotiating with investors seeking to overhaul management of the San Francisco-based utility, which filed bankruptcy protection in January in the face of $30 billion of liabilities tied to wildfires.
An ad hoc committee of shareholders being represented by the law firm Jones Day has discussed nominating at least nine board members, people familiar with the situation said this week.
Separately, activist investors BlueMountain Capital Management and ValueAct Capital Management have already banded together to press for their own long-term overhaul of PG&E's leadership. BlueMountain submitted nominations for the company's board last week.
PG&E, which has been engaged in talks with BlueMountain and other shareholders, plans to overhaul its board so that a majority of the directors are “new, independent directors” by the time it holds its annual meeting, according to a statement this month.
The company is also looking for a new chief executive officer, following the departure of Geisha Williams in January. PG&E is seeking a CEO candidate willing to take a low starting salary with the possibility of large back-end incentives, the people said.
--With assistance from Anders Melin.
To contact the reporters on this story: Kiel Porter in Chicago at kporter17@bloomberg.net;Mark Chediak in San Francisco at mchediak@bloomberg.net;Scott Deveau in New York at sdeveau2@bloomberg.net
To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net, ;Lynn Doan at ldoan6@bloomberg.net, Matthew Monks
©2019 Bloomberg L.P.
-
Talking Points This Week: Tech Nerves, FII Buying, And A Faraway Banking Shock
The global markets are not shining this Diwali. The exception in the large markets is, India.
-
Midterm Rally Lasted A Day. The Hard Reality Of A Divided US May Last Two Years | Opinion
Between a contested AI boom, a debt ceiling that arrives in 2027 and a president with every incentive to act alone, the next two years may prove more volatile than the first day's rally suggests.
-
Blue Wave Will Derail the AI Trade but Won't Dismantle the AI Era | Unhedged Position
The Democrats' sweep of the US Congress will see politics collide with economic forces both over the long and short term.
-
It's Time To Take The GST Council's Bet On Trust Global
Payment records can prove India's services exports, and clear, proportionate rules can bring foreign digital sellers into the tax net.
-
Opinion | India at 38: From Innovation Overperformer to Innovation Powerhouse
India now has 453 VC-backed deep science startups, 18 of them late-stage, after 117 percent growth since 2020. Laurus Labs, at USD 9.3 billion, is the most valuable deep science company in any middle-income economy outside China.
-
Navigating Energy Crossroads: S Jaishankar's Call For Diversified Supply Chains At G20 Ministerial Meeting
As geopolitical fault lines continue to test maritime trade routes and commodity flows, Jaishankar's message remains pertinent: true economic resilience requires open markets, protected transit lines, and a genuine commitment to multilateral cooperation rather than coercion.
-
Indians Are Travelling, But Not Every Journey Is A Holiday | The Week In Whys
Pilgrims, patients and working women are the real travellers, and the system hasn't quite caught up with them.
-
Getting To Work Costs Women More | The Reason Why
It is not just about women paying more than men. It is about women paying much more in cities than in villages.
-
AI Bias In Investing Cannot Be Eliminated, But It Can Be Governed
Framing is a particularly important example as identical financial information presented in terms of gains rather than losses can lead an LLM to reach a different assessment.
