Barrick Gold Corp.'s board gave chief executive officer Aaron Regent a perfect grade for his performance last year -- just five months before replacing him.
The sudden change at Barrick, announced Wednesday, surprised the market. It's all the more shocking given the board's assessment of how Mr. Regent did last year as CEO.
All the top five paid executives at the company, including Mr. Regent, were graded 100 per cent for their performance in 2011, according to the company's most recent circular, prepared for May 2 annual meeting.
The grade is used as part of the board's mechanism for calculating bonus payouts, and was part of the board's decision to pay Mr. Regent a $2.3-million bonus that was above the company's target for him.
The board lauded Mr. Regent for his performance, including “overall leadership for the Company, with an appropriate tone and focus from the top, to ensure the corporate and individual performance objectives set out at the beginning of the year were met.”
Mr. Regent “successfully led Barrick's acquisition of Equinox Minerals Limited, focused on identifying value from Barrick's existing asset base and increased the Company's focus on effective corporate social responsibility practices. He improved organizational effectiveness with the implementation of a more comprehensive strategic planning and life of mine planning process and improved capital management. Mr. Regent enhanced talent management and succession planning by establishing an executive talent council that meets regularly through the year.”
As a result, he was given a 100 per cent grade. The company beat objectives, scoring 120.7 per cent on its corporate objectives. The board used those two numbers to determine that he should be paid a bonus of 140 per cent of his salary, above the 125 per cent target set for Mr. Regent.