Novartis chairman- Waving a $78 million payout goodbye - NVS

Northern, WI 02/20/2013 (avauncer) - Daniel Vasella, outgoing CEO of the Swiss pharmaceutical giant Novartis AG (ADR) (NYSE:NVS) will be waving goodbye on Feb 22^nd not just to the company he headed, but to a whopping $77.9 million which translates to 72 million Swiss francs. This at his own behest and express request to Novartis AG (ADR) (NYSE:NVS). The non-compete agreement payment was scheduled to be given to him over a period of 6 years.

Forgoing benefits

Vasella had made a public announcement stating that a major part of this payment will be diverted towards philanthropy. Notwithstanding this intention, Novartis AG (ADR) (NYSE:NVS) had faced a lot of flak from several quarters in Switzerland who said that it was an obscenely large compensation towards such an agreement. As a result of these protests, Vasella had suggested to the Novartis board that he will forgo all rights to any payments that are linked to the non-compete agreement.

Stakeholder opinion given priority

Novartis AG (ADR) (NYSE:NVS) announced that they operate on the policy of complete business transparency and that they believe that this agreement only benefits the company. It essentially restricts an ex-employee from operating as a direct rival with the company and that helps in keeping its critical information and resources untouched. However, in the same breath they also said that they consider their stakeholders and shareholders to be of primary importance and that all information regarding cancellation of the agreement and any other compensation will be openly accessible to everyone concerned.

Shares of Novartis AG (ADR) (NYSE:NVS) were up by 0.64% to close at $69.64.