The railroad CEO whose company is at the center of last year’s train wreck in East Palestine, Ohio, finished the year with a $3.6 million raise, according to a securities filing.
Norfolk Southern CEO Alan Shaw’s total compensation rose from $9.8 million in 2022 to $13.4 million in 2023, according to the company’s proxy filing with the Securities and Exchange Commission. The disclosure comes as Norfolk Southern faces a shareholder campaign to replace most of its board members and fire Shaw.
Shaw became the company’s public face in the wake of the wreck, visiting East Palestine several times and testifying in Congress on rail safety reforms.
The pay bump includes a 22 percent percent raise in Shaw’s base salary, from $900,000 to $1.1 million, along with bonuses and stock awards. Shaw also gets other perks, including use of a private airplane.
Norfolk Southern said Shaw and other executives only got a portion of the bonuses they could’ve earned in 2023, based on the company’s financial, customer service and safety goals.
“As we look ahead, we are holding management accountable to deliver on our commitments, and are confident that our CEO, Alan Shaw, and the rest of the management team are focused on delivering safe, reliable service to customers, enhancing value for all shareholders, and fulfilling our commitments to our stakeholders,” board Chair Amy Miles said in a letter to shareholders.
The board is also asking shareholders to approve two new directors, including former U.S. Sen. Heidi Heitkamp and former Amtrak CEO Richard Anderson, in an effort to “refresh” its membership and beef up its oversight of the company’s operations.
Ancora Holdings Group, which is leading the campaign against Shaw and the existing board, said the pay raise is a failure of governance and shows the need for a board shakeup.
“It’s alarming that the Board rewarded Mr. Shaw with a massive raise and total compensation of $13.4 million during the same year he presided over industry-worst operating results, sustained underperformance and a tone-deaf response to the derailment in East Palestine,” the investor group said in a statement.
The East Palestine wreck happened in February of 2023, when a Norfolk Southern train jumped the tracks just outside the town’s business district. Several tank cars of toxic chemicals overturned and spilled their contents, and a series of fires burned for days.
No one died in the wreck, but residents expressed concerns about the long-term impact of the chemical exposure.
The National Transportation Safety Board and the Federal Railroad Investigation both found flaws in Norfolk Southern’s safety practices. FRA Administrator Amit Bose warned the company last week against “backsliding” on safety.
