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A man wearing a mask walks out of a Canadian Tire store in Toronto.Frank Gunn/The Canadian Press

A banner year in pandemic retailing meant millions of dollars in bonus pay for executives at two major companies – and at least hundreds of millions more for the families who control them.

At Canadian Tire Corp. Ltd. CTC-T, top executives saw bonuses rise by 80 per cent or more in 2021, with the company paying CEO Greg Hicks a bonus of $2.64-million, nearly triple that of the year before.

Grocery chain Loblaw Cos. Ltd. L-T paid each of its five best-paid executives bonuses of more than $1-million, with president Galen Weston and chief operating officer Robert Sawyer topping $2-million. The companies paid out maximum or near-maximum bonuses based on sales and earnings results for the year.

But it is the families who control the two companies who saw far more dramatic increases in their wealth.

Mr. Weston’s family owns more than half of George Weston Ltd., which owns more than half of Loblaw. Their stake grew in value from $5.9 billion at the beginning of 2021 to $9.7 billion by year end. The company’s share price climbed by nearly 70 per cent. Further gains in 2022 have pushed the value of the Westons’ stake to more than $10.8 billion as of this week.

Martha Billes and her son Owen Billes, who control Canadian Tire, saw the value of their stake rise from $550-million at the beginning of 2021 to more than $850-million by year end, largely on the strength of gains in the price of their thinly traded voting shares. The value of their stock has topped $925-million at recent prices.

Executive pay at retailers has become a hot-button issue during COVID-19. Many businesses that employed essential, front-line workers who can’t do their jobs safely at home gave “pandemic pay” – increased wages or bonuses – during the earliest months of the public-health crisis, but for the most part, they scaled back or eliminated the pay later in 2020.

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Canadian grocers offered some one-time bonuses or temporary pay boosts in 2021, but Canada’s largest private-sector union, Unifor, was unsuccessful in getting companies to bring back universal pay premiums.

Canadian Tire benefited from shifts in consumer habits during the pandemic, as people spruced up their homes, backyards and gardens and demand shot up for products such as bicycles, trampolines and treadmills. At the same time, it cut costs through an operational efficiency plan it launched in November of 2019.

Canadian Tire paid Mr. Hicks $6.92-million in his first full year as CEO in 2021, including a $1.1-million salary and share and stock-option awards valued at $2.97-million and the $2.64-million bonus. He made $4.49-million in 2020, a year in which he moved from president of its retail division to the top job on March 12.

The key to the bonus payouts for Mr. Hicks and his fellow executives was Canadian Tire’s decision to set modest financial targets for 2021 after big pandemic-related sales in 2020.

For pay purposes in 2021, Canadian Tire set an earnings target that was 11.7 per cent below the earnings of the prior year. The goal that would pay maximum 2021 bonuses was also below the 2020 profit number.

The comparable-sales-growth goal of 0.86 per cent was more than eight full percentage points below the 2020 number of 9.5 per cent. And the executives would get at least some of their bonuses even if comparable sales fell.

When the company tallied actual results for 2021, it far surpassed the maximum thresholds in the plan, resulting in the maximum possible annual cash bonuses for the executive team.

Asked about the goal-setting, Canadian Tire spokeswoman Joscelyn Dosanjh said in an e-mail that the 2021 targets were set at a time of widespread store closings and capacity restrictions in response to a rising wave of COVID-19 cases.

“At that time, vaccines were not yet widely available and there was no clear view as to when we would emerge from the pandemic, and how consumers would behave once we did,” she said.

She said the company’s “exceptional results” benefited not just shareholders but all the company’s stakeholders, including non-management employees who received performance bonuses.

Loblaw lagged competitors in 2020 in profits and same-store sales growth and began making significant changes in 2021. After Mr. Weston returned as president last spring, the new executive team launched a strategic review of the business.

Mr. Weston vowed to return to “retail fundamentals,” closing or converting the formats of underperforming stores, improving the efficiency of its e-commerce operations, and cutting initiatives such as meal kits that were not contributing to the business.

Loblaw paid Mr. Weston, who holds the titles of chairman and president, $5.41-million in 2021. That was up from $3.55-million in 2020, when he served as executive chairman, and Sarah Davis was the company’s president. Ms. Davis left the company in May, 2021.

Mr. Weston’s pay package included a $730,546 salary, a $2.17-million bonus, and share and stock-option awards valued at $2.47-million.

Mr. Sawyer, a retired executive at Metro Inc. and Rona Inc. who was sitting on the George Weston Ltd. board when he became Loblaw chief operating officer in May, 2021, made $7.43-million in his first year at the company, including share and stock-option awards valued at $4-million.

Each of Loblaw’s five best-paid executives received bonuses of more than $1-million after the company paid nearly the maximum possible in the plan for its corporate performance. The majority of the plan is based on targets for sales and profits.

Loblaw set a sales target that represented a gain of about 1.7 per cent over 2020. It recorded sales of $53.17-billion, a gain of about 4.6 per cent over 2020. Its earnings goal was 5.1 per cent above 2020. It recorded earnings of $4.02-billion, about 16 per cent higher than 2020.

Those two results drove the Loblaw bonus formula to pay out nearly 200 per cent of target bonuses.

Editor’s note: An earlier version of this story overstated the value of Loblaw Cos. Ltd. stock owned by the Weston family because it attributed to them all of the 175 million shares held by the public George Weston Ltd., of which the family owns just 53.5 per cent. The correct numbers are that their stake grew in value from $5.9 billion at the beginning of 2021 to $9.7 billion by year end as the company’s share price climbed by nearly 70 per cent. Further gains in 2022 have pushed the value of the Westons’ stake to more than $10.8 billion as of this week.

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 22/02/24 3:59pm EST.

SymbolName% changeLast
Loblaw CO
Canadian Tire Corp Ltd

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