Salesforce CEO Marc Benioff attends the World Economic Forum in Davos, Switzerland, on Jan. 18, 2024.
Halil Sagirkaya | Anadolu | Getty Images
Salesforce investors voted against the corporate’s compensation plan for top executives, after shareholder advisory groups raised concerns about equity awards granted to CEO Marc Benioff.
In accordance with a regulatory filing on Monday, the resolution to approve the compensation received 339.3 million votes in favor and 404.8 million against on the annual meeting held on Thursday.
The board had urged shareholders to vote in favor of the resolution. But two shareholder advisory firms, Glass Lewis and Institutional Shareholder Services, each really helpful that investors vote down the measure.
For the 2024 fiscal yr, Benioff received $39.6 million in total pay, up from $29.9 million within the prior yr. While Benioff’s salary was flat at $1.55 million, he received additional stock and option awards and nonequity incentive plan compensation, based on the proxy statement. Probably the most recent sum also included security fees that had not previously been invoiced to the corporate.
In January, the board’s compensation committee gave Benioff a second long-term equity award price $20 million, in recognition of the corporate’s “successful transformation actions and robust financial performance within the fiscal yr,” amongst other aspects.
Glass Lewis wrote in its advice that “shareholders may reasonably be wary of the substantial discretionary equity grants” issued to Benioff in January, adding that there was a “lack of a totally convincing rationale” behind the grants.
Benioff was already amongst the biggest holders of Salesforce, with a stake of over 2% valued at near $6 billion. Glass Lewis said in its proxy paper that the extra performance-based restricted stock units and stock options were “unwarranted” because his interests were already aligned with that of shareholders.
The vote from the annual meeting is nonbinding.
“Our Compensation Committee, which is accountable for designing and administering our executive compensation program, values the opinions expressed by our stockholders and can consider the consequence of this vote when making future executive compensation decisions,” Salesforce’s board said in the corporate’s proxy statement.
The corporate declined to comment.
Salesforce shares rose 67% within the 2024 fiscal yr ended Jan. 31, the strongest performance since 2011.
Net income jumped to $4.1 billion within the fiscal yr from $208 million a yr earlier, while revenue increased 11% to $34.9 billion from $31.4 billion. In January 2023, Salesforce announced plans to put off 10% of employees, after activist investors began buying up stakes and demanding a greater mixture of profit and growth. Salesforce said in February it might begin paying a dividend to shareholders.
Salesforce shares are off 2.6% yr thus far.
