Hunter Harrison, Canadian Pacific Railway Ltd.'s departed chief executive officer, was paid a total of $18.8-million in 2016, according to company documents filed with regulators.
Mr. Harrison's compensation included $720,000 for personal use of the company jet, a housing allowance worth $16,000 and $32,000 for medical coverage. He received a bonus of $3.5-million on top of his $2.9-million salary and $6.5-million in non-equity incentives.
Mr. Harrison left CP at the end of January and was recently named CEO of CSX Corp. He forfeited $123-million in compensation and pension by leaving CP before the end of his contract. He is asking CSX shareholders to reimburse most of this amount or he will resign from the Florida-based railway.
Since his arrival at CP in 2012, Mr. Harrison has been among the highest paid CEOs in Canada. The average pay for a Canadian CEO, including benefits, stock options and bonuses, is $12-million, according to a Bloomberg study released in November.
Shareholders have seen returns of 150 per cent under Mr. Harrison's leadership, and profit has tripled at the Calgary-based company once considered an industry laggard.
Keith Creel, Mr. Harrison's replacement, was paid $8.9-million as operating chief in 2016.
CP said in its proxy circular released on Wednesday night that it is changing the way it pays executives, after facing criticism from major shareholders for failing to properly align executive pay with performance. Shareholders last year narrowly voted against the company's pay practices in a so-called say-on-pay ballot.
In response, CP says it is making several changes to its compensation plan, including removing the operating ratio as a measurement in the long-term incentive plan and adding a rail safety measure to the short-term incentive plan. "Shareholders would like to see safety and other operational measures formally incorporated into executive compensation," the company said.
New CEO Mr. Creel's use of the company jet will be restricted to business and family visits in the United States, and he will be paid "in line with the market and our peers," CP said.
Mr. Harrison's 2016 pay is $1-million less than he received in 2015, a year in which the share price fell by 20 per cent.
In 2016, CP's share price rose by 9 per cent.
RAILWAY INDUSTRY REPORTER — The Globe and Mail Published, Mar. 16, 2017