EMI pays £3.3m to departing CEO

EMI has paid departing chief executive Eric Nicoli £3.3m, despite issuing two profit warnings at the beginning of the year and a sharp decline in sales of recorded music.

Nicoli led the struggling company for eight years, but failed to pull off a merger that would have taken EMI into the top tier of recorded music.

“Big compensation payouts should be used as a carrot for success, not handed out in failure,” said Sandra Beale, HR consultant at SJ Beale.

“It will be seen as hugely unfair by their employees and will probably have a knock on effect on staff morale and motivation.”

The company was recently bought by private equity firm Terra Firma, which has drafted in its own team of executives to turn the company’s fortunes around, despite having no experience of the music industry.

“The new management structure will allow EMI to benefit from Terra Firma's experience in strategically transforming businesses and driving operational change,” said Guy Hands, CEO of Terra Firma Capital Partners.