With debt collectors closing in on all sides, Saab’s shaky PR took another hit today as the Swedish media repotred that members of the board of Swedish Automobile (SWAN), Saab’s parent company, received pay increases of some 633 percent over 2010. Thelocal.se reports that
New chairman of the board, Hans Hugenholtz, received a raise of 633 percent, from 147,150 kronor (about $23k) to 611,163 kronor (about $950k). Others also had their pay increased significantly.
Though the amounts are relatively small, and the dwindling ranks of unquestioning Saab supporters argue that the compensation is low compared to the Dutch average (SWAN is incorporated in The Netherlands), this is just the latest PR disaster to hit the struggling automaker. One Saab employee sums up the mood:
It feels like everyone is out to grab what they can get.
And no wonder they feel that way. Not only did worker paychecks arrive late, but Sweden’s national debt office has begun foreclosing on the first of its outstanding claims… and the initial amount (about $58k) could have been covered by the chairman’s pay increase alone. Sending the message that board compensation is more important than staying out of insolvency has to be some of the worst PR imaginable. Still, some will defend Saab no matter what…
Under fire from Swedish labor unions and media outlets, the Saab faithful are circling the wagons. The die-hards at Saabsunited are “sick and tired of the media in Sweden acting like teenaged girls spreading rumors etc.” and have posted “the facts” about SWAN’s board compensation (following the gameplan, as usual, of Saab’s own PR man):
1. By acquiring Saab, Spyker became almost 100 times bigger. With that follows responsibilities of the board members.
2. To be able to keep competent people on the board a company needs to pay them a certain amount when the company is at a certain size, this is very well known in the cases of Ericsson and Vattenfall in Sweden where even the swedish government has allowed compensations that were through the roof in the eyes of most people in order to be able to keep people and competence within the company. So now news there…
3. The compensations were raised retro-actively because of Spyker acquiring Saab on Feb 23, 2010 so the board had not been payed with the “right” amount when the job was actually done.
4. The board fees are paid by Spyker NV (Swedish Automobile NV) and NOT by SAAB…
To which I would respond:
1. Regardless of how big you are or have become, if you aren’t making money (or are having a hard time paying suppliers and workers), you shouldn’t be increasing board compensation.
2. It doesn’t matter how good Saab’s board is if there’s no money to pay workers and suppliers. A strong board ranks a distant third compared to the importance of these two groups which aren’t getting what they’re owed, let alone a pay raise.
3. Who cares? PR is all about timing, and the timing of this stinks.
4. This is a semantical distinction.
Please Lord, show some mercy: let this trainwreck be over soon!