Bulletin: Microsoft Board Increases Annual Compensation For CEO Satya Nadella To Almost $ 50 Million

Microsoft CEO Satya Nadella speaks in Seattle in May 2019 (GeekWire File Photo / Kevin Lisota)

Total compensation for Microsoft CEO Satya Nadella rose more than 12% to $ 49.9 million in fiscal 2021, which ended June 30. the new proxy statement of the company shows.

Nadella’s base salary remained the same at $ 2.5 million. The increase in total compensation came from stock awards, totaling $ 33 million for 2021, compared to $ 30.7 million for 2020; and the cash bonus, or “non-stock incentive plan compensation,” which stood at $ 14.2 million for 2021, compared to approximately $ 11 million for 2020.

In comparison, the median total annual compensation for Microsoft employees other than Nadella was $ 176,858, a CEO compensation ratio of 282 to 1, according to the proxy. This compares to an S&P 500 average of 299-1 for 2020, according to an AFL-CIO analysis.

Microsoft’s board said it has adjusted the formula for Nadella’s stock awards and cash bonuses this year, giving more weight to financial and operational performance, in response to shareholder feedback. This is where Nadella benefited, based on the board’s positive assessment of her performance and the results of the company.

Here are the financial benchmarks the board used.

Here is the board’s assessment of Microsoft’s operational results for the purposes of determining Nadella’s compensation.

Product & Strategy (10.0% by weight). Score: 145% out of 200%

As digital transformation accelerated across all industries in fiscal 2021, Mr. Nadella led Microsoft to strong growth across all of our business segments. Annual revenue growth for fiscal 2021 remained strong (18% year on year) despite the significant challenges our sales teams faced during the COVID-19 pandemic. Under Mr. Nadella’s leadership, in fiscal 2021, Microsoft deepened the differentiation of its commercial and consumer business portfolios, including significant Office 365 Commercial revenue growth (22% year-on-year ) and monthly growth in active Teams users to nearly 250 million. . Additionally, we have experienced strong engagement and revenue in our gaming business, as well as unprecedented engagement from LinkedIn users with annual revenues exceeding $ 10 billion. Mr. Nadella expressed our willingness to bring new offerings to market quickly, including Azure Synapse, Microsoft Viva, additional collaboration features in Teams, and identity, security, compliance and management features. devices that have helped our security business exceed $ 10 billion in annual revenue. . In addition, Mr. Nadella has strengthened and deepened Microsoft’s capabilities through critical offerings including AI, industry-specific solutions and games through strategic acquisitions. Additionally, he positioned the company for future growth as customer engagements increased dramatically in the Azure, Microsoft 365, and Game Pass product areas and development work was completed to launch Windows 11 during the year. fiscal year 2022.

Customers and stakeholders (10.0% by weight). Score: 170% out of 200%.

Mr. Nadella led Microsoft through the many challenges that arose in fiscal 2021, advancing our mission of providing services and solutions to all people and organizations around the world and navigating the business through. the COVID-19 pandemic. Under Mr. Nadella’s leadership, Microsoft continued to move forward on the issues that matter to customers and governments around the world, forging ground-breaking partnerships in healthcare, financial services, manufacturing and the industry. public.

Microsoft has also positioned itself as a leader in cybersecurity, with nearly 600,000 organizations using our security offerings on Azure and Microsoft 365. Under Mr. Nadella’s leadership, Microsoft continued to advance global cybersecurity policy through in its work with governments, the UN, the Paris Peace Forum, the Cybersecurity Tech Accord and the Society’s Democracy Defense Program. Mr. Nadella also launched our ambitious ten-year carbon reduction pledge and implemented a variety of internal programs to help achieve this pledge, including the largest carbon reduction purchase in the history of the world. ‘business.

Under Mr. Nadella’s leadership, Microsoft continued to have a significant impact on the lives of users in all geographies, stepping up efforts to ensure an inclusive economic recovery. In rural and urban areas, Microsoft tools and initiatives have enabled learning and training, including bridging the accessibility gap between people with disabilities through investments in technology, people, and people with disabilities. the workplace, and providing access to broadband service.

Culture and organizational leadership (10.0% weighting). Score: 180% out of 200%.

Mr. Nadella has fostered the cultural growth and engagement of the Company in fiscal 2021. The vibrant culture and talent of the Company is a key priority for the Board and Mr. Nadella, and his efforts in this area. were exceptional. Under Mr. Nadella’s leadership, Microsoft is on track to meet the company’s commitment to double the representation of black and African American, and Hispanic and Latin American senior leaders by 2025. In addition, Microsoft has achieved a notable increase in the representation of women globally in a year of significant growth in the employee population. Mr. Nadella accelerated the execution of the company’s talent management strategy by hiring a number of critical leaders across multiple functions, with a particular focus on the consumer, to better position Microsoft for growth in the near future. and long term and successful leadership succession.

Additionally, in fiscal 2021, Mr. Nadella led Microsoft’s efforts to expand its employee and community-focused health and wellness initiatives, including increased benefits for working parents, the development of large-volume vaccination clinics focused on equitable distribution and the creation of a hybrid workplace.

Mr. Nadella enthusiastically fostered a culture of empowerment. By implementing a model management framework, coaching, care, at a time when employees felt more isolated than ever, Mr. Nadella fostered a culture of employee well-being. In fiscal 2021, as we all went through disrupted work and home environments, employees, through our engagement surveys, provided historically strong ratings for the Company, its values ​​and its leadership.

Here is the compensation table for all of Microsoft’s named executives.

Read the full proxy statement here, including shareholders’ resolutions.

The board also appointed a new board member, Carlos Rodriguez, CEO of payroll giant ADP, who would bring the total to 12 board members.

Microsoft’s annual meeting will be held virtually on November 30. The company will release its results for the first fiscal quarter of 2022 on October 26.


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