Steven Elop, the outgoing CEO at Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V), will receive an €18 million payout on his departure as per his contract with the company. With the importance of Nokia to Finland and the number of jobs the company has shed in recent years, the golden handshake has caused outcry in the Nordic country.
Risto Siilasmaa, the chairman at Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) and the first ever Finn to make $1 billion, is in the biggest trouble over the deal. His biggest misstep was in telling reporters that the compensation due to Elop was the same deal that other Nokia CEOs got, when it was actually much more. Siilasmaa wrote this off as a mistake, but that hasn’t stopped the Finnish press and people bringing up the issue.
Nokia CEO compensation
Steven Elop served as the head of Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) from September 2010 until earlier this month. He is departing the company as part of a deal that will see the Nokia handset business become a part of Microsoft Corporation (NASDAQ:MSFT). Elop will move along with that business to the software giant.
Under the terms of his contract with the company and the deal between Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) and Microsoft Corporation (NASDAQ:MSFT) Elop wil receive €18.8 million when he departs the company. Microsoft will pay 70% of the sum while the rest of the bill will be footed by Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V).
The sum has caused a public rift in Finland. The Prime Minister of the country called the sum outrageous and the media has regularly ran stories about the affair. Much of the blame for the matter has fallen on the chairman of the company Risto Siilasmaa.
Nokia chairman blues
Risto Siilasmaa has been criticized for his handling of the entire situation at Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V). The company has served as a point of national pride for many years and its sales to an American multinational does not sit well. The installation of Mr. Elop, a Canadian, into the company and his subsequent outsized golden handshake is being questioned by the people of Finland as they deal with the loss of the country’s most famous company.
Siilasmaa is being made to answer for the payment to Elop and the sale of Nokia’s handset division, but there is little he has been able to do to dampen public opinion in the country.