Hanover's special circumstances led to special CFO salary
At first glance, Eugene M. Bullis is making a curiously large amount of money to be the interim chief financial officer at The Hanover Insurance Group in Worcester.
Bullis' $50,000 biweekly salary is – at an annualized rate – more than the $1 million base salary paid to CEO Frederick H. Eppinger in 2014, according to the company's U.S. Securities & Exchange Commission filings.
However, Bullis' hiring and salary come at a time when Hanover needs stability in its executive suite, said Michael Buckley, Hanover spokesman. Bullis is replacing CFO David B. Greenfield, who died unexpectedly in October, and he is joining the company as Eppinger is looking to retire as soon as a successor is appointed.
“Given Fred's decision to step down and David's tragic passing, it's especially important for us to appoint an interim CFO who will provide a continuity of financial leadership and strong financial oversight,” Buckley said.
Bullis received a $75,000 signing bonus and 1,222 shares of restricted company stock to be CFO until a permanent replacement is hired. He has agreed to work for the company until May 13, 2016. Bullis could earn up to $725,000 if he stays on until May, said Buckley.
Bullis, who was Hanover's CFO and executive vice president from 2007 to 2010, provided strong leadership during the height of the Great Recession, Buckley said.
“We offered what we believe is fair compensation given … the level of his experience and the significance of the role he's playing for us,” Buckley said.
By comparison, Bullis earned total compensation of $2 million per year on average for the last three years he was employed by Hanover, Buckley said. His interim salary, which will be paid in bi-weekly installments of $50,000, doesn't include the extras that permanent employees receive, such as cash bonuses. In total, Eppinger earned $5.2 million in 2014, while Greenfield earned a total of a little more than $2 million.
Bullis has stayed busy in retirement, serving on a number boards at public and private companies. Bullis is paid $475,011 in his capacity as a board member of Ambac Financial Group, a public company, according to Ambac's most proxy statement, and received a prorated fee of $12,500 after joining the Board of Directors of TheOne Group, a hospitality company, in August 2014, according to the public company's last proxy statement. Bullis is also on the board of directors of The Doctors Group, a large medical malpractice insurance company.
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