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FQM Executives Receive Pay Increase Despite Company’s Problems

Despite facing significant challenges including the closure of its largest mine and a substantial drop in stock value, executives at Canadian copper miner First Quantum Minerals Ltd. received notable compensation increases and positive performance reviews.

Last year, the Vancouver-based company was compelled to cease operations at the Cobre Panama mine following a ruling by Panama’s Supreme Court that deemed its mining contract unconstitutional. This mine, a cornerstone of First Quantum’s operations, contributed roughly half of the company’s revenue.

The financial repercussions were profound, leading to First Quantum being flagged as a “going concern risk” earlier this year. Additionally, the company experienced an increase in worker fatalities at its mine sites during 2023, exacerbating its challenges. Shareholders also bore the brunt of these difficulties, with the company’s stock plummeting by 62 percent over the course of the year.

Nevertheless, top executives including CEO Tristan Pascall, CFO Ryan MacWilliam, COO Rudi Badenhorst, and directors Zenon Wozniak and John Gregory, all received substantial boosts in total compensation ranging between 20 and 38 percent.

CEO Tristan Pascall’s total compensation saw a 30 percent increase, totaling US$4.5 million in 2023. This rise was primarily driven by an increase in share-based awards. Despite a decline in cash bonuses, which were attributed in part to safety concerns following fatalities at the company’s mines, executives’ overall compensation packages were bolstered by long-term stock incentives.

According to Alison Beckett, chair of the human resources committee at First Quantum, the decision to grant maximum levels of share awards was aimed at retaining talent and acknowledging achievements made prior to the legal ruling against the company’s mining contract in Panama. The hope is that these incentives will motivate the management team to navigate the challenges faced by the business, particularly in resolving issues related to the Panama mine.

Despite the ongoing turbulence, First Quantum recently secured significant financial relief through debt refinancing and new financing arrangements, providing a degree of stability in the face of uncertain market conditions.

The company’s efforts to incentivize executives to address its challenges reflect a balancing act between acknowledging past achievements, promoting long-term shareholder value, and navigating the complexities of its operational landscape, particularly in Panama where legal and environmental concerns continue to pose significant obstacles.

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