Top IPG Execs Pocket Bonuses in Down Year

NEW YORK John Dooner, who stepped down as CEO of the struggling Interpublic Group of Cos. in February 2003, was rewarded with a $750,000 bonus last year, on top of his $1.25 million paycheck, according to the company’s proxy statement released today. David Bell, who succeeded Dooner at IPG, received a $1 million base salary and a $1.3 million bonus. Both men made the same salaries in 2002, but neither collected a bonus that year.

At IPG, which lost $452 million on flat revenue of $5.9 billion last year, the hefty bonuses stood in contrast to the company’s anemic stock performance as detailed elsewhere in the proxy: A $100 investment in IPG, made in 1998, was worth just $41.07 in 2003. The same amount invested in IPG’s industry peer group was valued at $107.46.

Dooner, who returned to his job as CEO at McCann Erickson WorldGroup, was also paid $73,000 in “other annual compensation” and given 177,000 stock options. In the proxy, IPG’s compensation committee stated that Dooner, the highest paid executive within IPG’s ranks, was given the options “amid ongoing concerns that Mr. Dooner could be lured away with sizable option grants from other companies.” Dooner’s $750,000 bonus was 45 percent of target because of improvements at McCann, the committee said.

Bell also received $76,000 in other compensation and 200,000 stock options. His $1.3 million bonus represents 78 percent of his target award in achieving his performance goals that included improving IPG’s balance sheet, developing a long-term strategy for the company and improved financial performance. In determining the payout amount, the committee also said it “gave considerable weight to the circumstances under which [Bell] assumed the chairman and CEO role.” Bell was given a $100,000 signing bonus when he took the job.

IPG chief operating officer and chief financial officer Chris Coughlin, who joined IPG on June 16, made $433,000 for his six months on the job, plus a $900,000 bonus. Former chief talent and human resources officer Brian Brooks, who resigned in February, continues to receive his annual salary of $495,000 until February 2005. Brooks retains a consulting role at IPG, where he earns $400 an hour for services other than those in connection with executive recruitment.