CHICAGO - Procter & Gamble Co raised the salary of Bob McDonald by 40 percent to $1.4 million when he took over as chief executive last month, while his predecessor, A.G. Lafley, took home slightly more in his last year as CEO, the company reported on Friday.
According to the company's annual proxy statement, filed with the U.S. Securities and Exchange Commission on Friday, Lafley's total compensation rose to $23.6 million from $23.5 million in the previous year.
Lafley served as chairman and CEO in the fiscal year that ended on June 30. McDonald became CEO on July 1, while Lafley remained chairman.
The maker of Gillette razors and Tide laundry detergent is facing a tough climate as many consumers trade down to lower-priced goods as they deal with the financial downturn.
As expected, Lafley's salary was raised by $100,000 to $1.8 million for fiscal 2009. Among other compensation, he received $11.5 million in stock awards, up from $9.1 million a year earlier. He received $6.5 million in options, down from $7.8 million in the previous year.
Lafley's bonus based on the company's performance fell to $3.1 million. That amount was $50,000 lower than he could have received since certain sales and earnings-per-share growth fell short of P&G's long-term targets.
Still, Lafley received a larger percentage of his bonus than other executives. McDonald received a bonus of $1.125 million, or 90 percent of his target.
McDonald earned $1 million in his final year as chief operating officer. His salary was raised to $1.4 million for the current fiscal year, his first as CEO.
P&G's sales fell 3 percent to $79 billion last year. Excluding the impact of acquisitions, divestitures and currency fluctuations, sales rose 2 percent. Earnings per share jumped 17 percent to $4.26.
Shares of P&G fell 16 percent during its fiscal year, while the Dow Jones industrial average .DJI, of which it is a component, fell 25.6 percent. (Reporting by Jessica Wohl; editing by John Wallace)