GM failed to disclose $600k sweetheart deal to CFO’s wife
General Motors told the U.S. Securities and Exchange Commission today that it failed to report a $600,000 deal given to an advertising agency where the wife of a top GM executive is a partner
GM said in an SEC filing that it had “recently learned about” a contract awarded in 2011 to an agency where Chief Financial Officer Dan Ammann’s wife, Pernilla Ammann, is chief operating officer and partner.
The automaker added: “This transaction has been properly ratified under our Related Party Transaction Policy, but not all the required procedures were followed.”
The company has a detailed policy dictating how potential conflicts of interest must be handled. Part of the policy: Deals of more than $120,000 in which a top executive’s spouse has a financial interest must be approved by CEO Dan Akerson and Senior Vice President and General Counsel Michael Millikin. The arrangement must then be reported to the GM Board of Directors’ Governance Committee, which annually reviews each top executive’s independence.
The deal was awarded to Mother New York, an ad agency that employs Pernilla Ammann, for creative work related to Chevrolet’s 100th anniversary celebration last fall, the Free Press has confirmed.
GM spokesman Dave Roman said the automaker “inadvertently failed to disclose in our proxy statement” that the deal had occurred last year, in part because Dan Ammann only found out about the deal recently.