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Ian Edwards has been at SNC since 2014, starting as an executive vice-president.

Dario Ayala/Reuters

SNC-Lavalin Group Inc. paid CEO Ian Edwards, the man designated to lead it out of a period of scandal and controversy, $8.02-million in 2020 – his first full year on the job – including $5.62-million in stock awards.

SNC said $1.8-million of those stock awards came in the form of a one-time grant the company intended to give him in 2019, when he was appointed CEO, but could not due to restrictions in the company’s insider-trading policy.

His pay package also included $1.03-million in salary and an annual bonus of $1.07-million, which he took in the form of stock in the company’s deferred-share program.

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Mr. Edwards has been at SNC since 2014, starting as an executive vice-president. SNC made him interim CEO in June, 2019, upon the departure of Neil Bruce, and awarded him the job that November.

Mr. Bruce made $5.45-million in 2018, his final full year as CEO. His 2019 compensation of $7.02-million included a bonus of $669,744 and the payout of $1.54-million in stock awards; since he technically retired, he did not receive a formal severance.

Mr. Bruce left just as SNC’s stock price tumbled amid legal problems and possible sanctions from several countries and international groups. At the time, the company faced bribery and fraud charges in Canada over its business dealings in Libya. SNC ultimately settled the Canadian matter, and on Tuesday it said the World Bank had given it an early reprieve on a decade-long ban issued in 2013 for corruption tied to contracts in Bangladesh and Cambodia.

In 2020, however, the pandemic played a bigger role in how SNC wrestled with compensation. It said it cancelled the financial portion of its annual bonus plan for the first half of the year, then adjusted financial targets for the second half. The non-financial portions – relating to safety, integrity and personal performance – remained unchanged for the whole year, SNC said, and were weighted at one-third of the bonus.

The financial portion included goals for adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) and free cash flow, which takes cash generated by the company’s operations and adjusts it for capital spending and other items.

SNC said it missed its EBITDA target of $246.9-million by almost 17 per cent and thus paid no bonus for it. It had a goal of negative free cash flow of $430-million but posted negative free cash flow of $104.4 million – an “exceptional” result, the company said, meriting a full bonus payout for that part of the formula.

The high first-year pay for Mr. Edwards illustrates what can be a high cost of executive transitions. At Bombardier Inc. , former CEO Alain Bellemare was paid US$12.77-million in 2020, including a previously disclosed US$12.53-million severance package. Mr. Bellemare made US$7.62-million in 2019.

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Bombardier, however, eschewed a large welcome package for new CEO Éric Martel, who made US$2.96-million in 2020, not counting a US$1.24-million long-term incentive that Bombardier said it will include in annual compensation numbers when it pays out. Bombardier paid Mr. Martel a sign-on cash bonus of $600,000 (US$423,200) in April, 2020.

For three Bombardier executives in similar positions from 2019 to 2020, total pay dropped, as the company granted fewer stock awards. Two of the executives departed in January, 2021, when Bombardier sold its transportation division to Alstom SA.

Both SNC and Bombardier made changes in their top finance job, incurring extra compensation costs. SNC hired Jeff Bell as chief financial officer, paying him $3.17-million. His $2.09-million in stock awards included a special sign-on grant valued at $360,000.

His predecessor, Sylvain Girard, made $4.86-million in 2020, including $4.42-million as part of his separation agreement. He made $2.61-million in 2019, his final full year as CFO.

At Bombardier, John Di Bert departed in November. He made US$4.89-million in 2020, including a US$3.77-million severance package. His successor, Bart Demosky, received a stock award of US$482,600 on Dec. 1.

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