Critics of high pay in the boardroom have rounded on the former chief executive of Diageo, Paul Walsh.
Walsh, who led the spirits and beer giant for more than a decade, parted this year with a package of £14.8 m — the larger part of which was represented by bonuses in shares.
This made Walsh the second highest paid executive in the FTSE 100 behind Angela Ahrendts, the American CEO of luxury fashion group Burberry.
Arguably Walsh has been worth every penny. He inherited a group that had great brands but suffered from reputational damage due to the Guinness £2.6 billion bid for Distillers in 1986.
Prosecutions for an illegal share support operation were brought against four Jewish businessmen: former Guinness CEO Ernest Saunders; millionaire stockbroker Anthony Parnes; the head of the Heron property empire Gerald Ronson and the late Jack Lyons of United Drapery Stores.
In 2000 the European Court of Human Rights ruled that the 1990 trial against the convicted “Guinness Four” was unfair.
But the damage was done.
Distillers, despite being the top group in the thriving Scotch whisky industry, also had a difficult history because of its involvement in the manufacture of the drug Thalidomide. It was only after a newspaper campaign led by the Sunday Times that Distillers recognised its responsibilities to victims and their families.
In his years at the helm Walsh brought new direction to Guinness-Distillers. The corporate name Guinness was replaced by Diageo. He also expanded the group beyond its traditional expertise by buying new brands such as Captain Morgan’s rum and moving into emerging markets.
Diageo bought Turkey’s premier spirits brand Mey Icki and won control of United Spirits in India owner of the Whyte & Mackay whisky brands. Diageo became one of the first Western companies to be allowed to buy into China where it has a majority stake Shui Jing Fang, maker of the most upmarket rice wine brand.
Shareholders can have few complaints. Despite the eurozone crisis, Diageo shares rocketed under Walsh’s stewardship with the market value of the group tripling to £51 bn.
Walsh may not be Jewish but he deserves his farewell L’Chaim.