OMAHA, Neb. (AP) — Union Pacific Corp.'s acting CEO earned less than one-third of the $13.3 million the railroad's top executive received last year.
The Omaha-based railroad's executive vice president for marketing and sales, Jack Koraleski, is serving as acting president and CEO while Jim Young battles pancreatic cancer. UP filed documents with the Securities and Exchange Commission on Monday detailing the compensation both men received before Young began his leave.
Both Koraleski and Young saw their compensation grow in 2011 along with the railroad's profits. Koraleski's compensation increased 13 percent to Young's 11 percent growth.
Young, who remains chairman, received compensation worth $13.3 million last year. That's up from nearly $12 million.
Koraleski received $3.9 million in compensation, up from $3.5 million in 2010.
UP board said the executives deserved more compensation because of the railroad's outstanding results.
In 2011, Union Pacific generated net income of $3.29 billion, or $6.72 per share, up from $2.78 billion, or $5.53 per share, in 2010. Annual revenue grew 15 percent to $19.56 billion from the previous year's $16.97 billion.
The AP's formula for calculating executive compensation is designed to isolate the value the company's board placed on the executive's total compensation package during the last fiscal year. It includes salary, bonus, performance-related bonuses, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year.
The calculations don't include changes in the present value of pension benefits, making the AP total different in many cases from the totals companies report to the Securities and Exchange Commission.
Union Pacific is the nation's largest railroad with more than 32,400 miles of track in 23 states between the West, the Midwest and the Gulf coast.
At the railroad's annual meeting in Salt Lake City, Utah, shareholders will have a chance to vote on two shareholder proposals along with several routine items. The meeting will be held May 10.
One shareholder proposal would recommend that the railroad's executives be required to retain at least 25 percent of the stock they receive from the company until a year after they stop working at Union Pacific.
The board opposes that proposal because it already requires the railroad's top executives to own significant blocks of stock. For instance the CEO is required to own stock worth seven times his base salary.
The other proposal would require Union Pacific to disclose additional information about its political contributions and lobbying. Shareholders have rejected a similar measure in the past, and UP's board opposes this.