Ross McEwan, Andrew Thornburn count cost as NAB trims pay

Former NAB CEO Andrew Thorburn lost $7m in entitlements in the wake of the Hayne while COVID has trimmed his successors pay by 20%.

NAB’s annual report has detailed the impact of COVID the Hyane royal commission on the pay of former CEO Andrew Thorburn and his successor Ross McEwan. Picture: AFP

New National Australia Bank chief executive Ross McEwan pocketed $2.42m in remuneration for part of 2020, after taking a 20 per cent cut in his fixed pay in the September half-year due to the global pandemic.

NAB’s annual report, released on Wednesday, also showed that former chief executive Andrew Thorburn lost $7m in share and rights entitlements in 2019.

Mr Thorburn left NAB in February last year after he was targeted - along with then-chairman Ken Henry - in financial services royal commissioner Kenneth Hayne’s final report.

Mr McEwan, who became NAB CEO in December 2019, volunteered a $250,000, COVID-related cut in his cash salary, which came in at $1.87m.

The CEO and other group executives did not receive any short-term bonuses, with Mr McEwan, as a recent recruit, failing to qualify for any long-term variable reward.

While his statutory remuneration was $2.42m, the NAB chief’s realised pay for the period was $1.84m.

At NAB’s full-year result, unveiled last week, Mr McEwan said shareholders were hurting and the bank’s senior executives needed to “share that pain”.

Remuneration committee chair Anne Loveridge said in the annual report, released on Wednesday, that the CEO had refreshed NAB’s long-term strategy and implemented a new operating model.

“We have renewed the executive leadership team through the appointment of four new group executives and a change in position for one other,” Ms Loveridge said.

She also flagged a “modes” range of changes to the remuneration framework in 2021.

Among other things, the bank would ensure its performance measures aligned with the refreshed strategy, simplify the calculation of the annual variable reward, and improve governance through a clearer application of accountability and remuneration consequences.

Mr McEwan’s recruitment as CEO triggered the departure of some internal leadership aspirants, including the head of the consumer bank Mike Baird and business banking boss Anthony Healy.

Mr Baird left with a total package of $1.93m, including $1.11m in “other” remuneration. Mr Healy’s departure package came to $2.22m, of which $1.17m was other remuneration. Both former executives received termination payments equal to 26 weeks of their base salaries, in line with their employment contracts.