An Italian businessman who didn’t work a single day with the company is still being paid a seven-figure severance package.
Attractive compensation packages are essential when it comes to getting high level execs on board but one cosmetics company must be kicking themselves after offering an unbelievable employment contract to a new CEO.
A global leader in beauty products, Coty announced in April of this year that Elio Leoni Sceti would be taking over as its next CEO come July – but it seems the Italian businessman had a last minute change of heart.
“Elio Leoni Sceti, who was planned to assume the role of CEO in July, has reconsidered and decided not to join Coty,” the company announced in a news release, just days before Sceti was due to step up.
But being left in the lurch is the least of Coty’s worries – the company has also had to shell out a seven-figure severance package despite Sceti never serving a day.
A filing with the SEC revealed that Coty would be paying its never-to-be CEO a severance equivalent to approximately $2.17 million. The company also confirmed it would be buying back Sceti’s preferred stock, which is worth about $70,000.
Coty insist the pay-out is in keeping with the contract Sceti signed in April, detailing a severance package equal to a year’s annual salary.
The company also stressed that “leadership continuity” is critical as it moves ahead with its new business strategy and confirmed interim CEO Bart Brecht would remain at the helm.
