Netflix said it was working on changes to its CEO compensation policy after a majority of shareholders voted not to approve executive compensation in a non-binding vote at its last annual meeting. The company already said this at the beginning of the year.
“We recognize that we do not have widespread support for our executive compensation model of the past twenty years. We are listening to our shareholders and plan significant changes to a more conventional model in 2024. Our executive compensation plan will continue to be based on performance-based compensation,” the company said in its annual letter to shareholders.
Netflix has had ongoing disputes with shareholders over CEO compensation.
For 2022, Netflix’s co-CEOs last year — then Reed Hastings and Ted Sarandos — topped CEO compensation by about $50 million each, up 25% and 32%, respectively. Hastings was named executive chairman earlier this year, with Sarandos and Greg Peters now co-CEOs. Netflix gave executives the ability to choose how they wanted to be paid: cash or stock. Sarandos is inclined to take cash and was aiming for a base salary of $20 million. (Hastings took almost all of his salary in stock options last year, as he usually does.)
At the insistence of shareholders, the company then said it had revised its compensation policy. Starting in 2023, the co-CEO’s base salary will be capped at $3 million and 50% of eligible compensation must consist of stock options — but only with a one-year vesting period, so not particularly long.
Source: Deadline
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