Satya Nadella’s pay fell to $90.6m as Microsoft shares declined
Microsoft chief executive Satya Nadella received $90.6 million in total compensation in the fiscal year ending 30 June, around $6 million less than the previous year. The fall followed a decline in Microsoft’s share price during the year, while the company pursues cost controls and investment in artificial intelligence.
His compensation included a $2.5 million base salary, $77.5 million in stock awards, a $10.3 million cash bonus and $259,204 in other benefits. Microsoft’s median employee compensation rose from just over $200,000 to more than $215,000. The company has also offered voluntary buyouts to nearly 60,000 staff; it expects 3 to 5 per cent of eligible employees to accept, or fewer than 3,000.
In short
- Nadella’s compensation fell by about $6 million to $90.6 million.
- Stock awards made up $77.5 million of his total.
- Microsoft expects fewer than 3,000 staff to take buyouts.
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The case for
Nadella’s pay is largely tied to Microsoft’s performance, with most of it in stock awards, so its decline alongside the share price can be seen as shareholders and the chief executive sharing some of the same risks. The company can also argue that substantial compensation helps attract and retain leadership capable of guiding major investments in AI, while median employee compensation has risen.
The case against
Even after falling, $90.6 million is an extraordinary sum at a time when Microsoft is pursuing cost controls and offering buyouts to thousands of staff. Critics may question whether share-linked awards adequately reflect the chief executive’s contribution or accountability, and whether such a large gap between executive and typical employee pay is justified.
Explained simply
Satya Nadella has led Microsoft since 2014, overseeing its software, cloud computing and artificial intelligence businesses. As chief executive, his pay includes a salary and bonus as well as shares whose value can change with Microsoft’s stock price.
Microsoft employs people around the world and reports how its executive pay compares with the pay of a typical employee. It has also offered voluntary buyouts to some staff as it manages costs while investing in artificial intelligence. These figures matter to investors and employees because they shed light on how the company rewards senior leaders and manages its workforce.
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Originally published by Daily Mail as “Microsoft CEO earned $90.6m salary last year… $6m less than the year before after the computing giant’s stock tanked”.