Goldman Sachs’ plan to pay a one-time $30 million bonus to chief govt David Solomon and a $20 million bonus to chief govt John Waldron is “extreme,” proxy adviser Glass Lewis mentioned on Friday.
The shareholder advisory agency instructed Goldman shareholders they need to vote in opposition to the manager compensation bundle that incorporates the one-time bonuses.
“We’re involved in regards to the particular, one-time grants to the CEO and COO,” Glass Lewis’ observe to shareholders reported by the Monetary Occasions mentioned. “Such rewards have the potential to undermine the integrity of an organization’s common incentive plans, the hyperlink between pay and efficiency, or each.”
Goldman mentioned his compensation will “drive the creation of long-term shareholder worth” and “guarantee continuity of management over the following 5 years and past.” The multi-million greenback inventory rewards is not going to be paid out till October 2026.
Glass Lewis mentioned when shareholders are requested on April 28 in the event that they approve of the compensation packages, they need to say no. So-called pay votes in publicly traded corporations are strictly advisory, but when an organization’s shareholders vote in opposition to a pay bundle, it may be seen as a black eye.
“We consider that long-term incentives ought to encourage leaders to attain regular, sustainable development fairly than what might quantity to comparatively temporary efficiency spikes,” Glass Lewis mentioned.
Goldman Sachs didn’t instantly reply to request for remark.
At Goldman, Solomon’s whole wage contains an annual base wage of $2 million and variable compensation of $33 million, 70% of which is within the type of goal-based fairness compensation or efficiency items. restricted shares.
Salomon’s compensation is consistent with its opponents. Morgan Stanley CEO James Gorman additionally picked up the identical quantity — $35 million — for 2021. JPMorgan Chase CEO Jamie Dimon’s whole compensation in 2021 was $34.5 million.
Solomon’s wage in 2021 was double the $17.5 million he earned in 2020 – Solomon was moored after Goldman admitted wrongdoing within the 1MDB scandal that plundered Malaysia’s sovereign wealth fund.
In the meantime, financial institution shares have fallen sharply to this point this yr, even after stellar outcomes following a banner yr for mergers and acquisitions.
It’s because additionally they reported considerably increased bills, largely as a result of giant salaries they hand out in a good labor market.