Former ANZ CEO Shayne Elliott Sues Over Forfeited Bonuses
In an unprecedented move, Shayne Elliott, the ex-CEO of ANZ, has initiated legal proceedings in the Supreme Court of New South Wales (NSW) over bonuses he was denied in the last fiscal year. This case marks a rare instance of a top-ranking executive legally challenging a bank over compensation issues.
Elliott’s Claims
Elliott released a statement explaining his decision to sue, stating, “I have been left with no alternative other than to commence proceedings in the Supreme Court of New South Wales. I am seeking a declaration that the bank has breached the contract that I had with it.” He also expressed his commitment to pursuing the matter, emphasizing that he would seek the earliest possible hearing.
ANZ’s Response
ANZ Bank responded to Elliott’s legal action in a formal statement where it emphasized its obligation to design remuneration that promotes prudent risk management and links executive pay to performance and risk outcomes. The bank further explained that its Board is required to consider these aspects when determining the release of unvested equity on an annual basis.
Upon evaluating remuneration outcomes in the past year, the Board decided that no Australia-based Group Executive would receive short-term variable remuneration, with the exception of those in acting roles. The Board also resolved that some of Elliott’s long-term variable remuneration due to vest in 2025 and 2026 would be adjusted downwards to zero.
ANZ Chairman Paul O’Sullivan backed the bank’s stance, stating, “The Board has been considered and very deliberate in its assessment of remuneration outcomes. We are confident in our position and we will defend this matter vigorously.”
Implications and Outcomes
While the matter is currently before the courts, the outcome could potentially have significant ramifications for executive remuneration practices within the Australian banking industry. The case raises fundamental questions about the contractual obligations of banks to their executives and the discretion they can exercise in adjusting remuneration based on performance and risk outcomes. This case will be closely watched by industry observers and could influence future executive remuneration practices.
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