Satya Nadella made $11.6 million in fiscal year 2014, which includes compensation both for his time as head of Microsoft’s cloud and enterprise division, and as CEO — a job he assumed in February.
That’s according to the company’s proxy statement, filed Monday with the U.S. Security and Exchange Commission.
Microsoft’s fiscal year runs July 1 to June 30. Nadella’s salary for that time period includes $918,917 in base pay along with a $3.6 million cash award and a $7.09 million annual stock award.
Here’s Microsoft’s chart showing the compensation of its top executives, which, in addition to Nadella, includes Amy Hood, CFO; Harry Shum, executive vice president of technology and research; Brad Smith, general counsel; and Kevin Turner, COO.
Microsoft’s board noted that Nadella’s incentive plan cash award of $3.6 million was 141 percent of his target award.
“In reaching this decision the independent members of our board considered Mr. Nadella’s performance against this core priorities, the financial and operational performance of the company, and the financial performance of the company relative to a group of large technology companies,” Microsoft said in the proxy statement.
The statement continues:
Prior to his appointment as CEO, Mr. Nadella successfully led the Cloud and Enterprise business where he drove the transformation to the cloud infrastructure and services business. In fiscal year 2014, the commercial cloud annual revenue run rate more than doubled and now exceeds $4.4 billion. He helped drive high renewal rates in our hybrid cloud offerings as well as continued investment in premium versions of our on-premise server products. In addition, as the leader of the Cloud and Enterprise business, Mr. Nadella was responsible for developing a deep technical organization with a strong leadership team from which his successor was selected.
Since becoming CEO in February, Mr. Nadella led the development of our mobile-first and cloud-first strategy, guiding the Company through significant organizational changes, restructuring and evolution of the company’s culture.
Although Nadella received $11.6 million in compensation last fiscal year, he was also granted stock awards worth $79.78 million (including the $7.09 million he actually received in fiscal year 2014). Those awards had to be declared in fiscal year 2014, although he will not be eligible to receive the compensation until several years into the future. That amount includes a target of $59.18 million in long term performance-based stock awards, which he will not be eligible to receive any part of until 2019. It also includes a one-time special retention stock award — with a grant date fair value of $13.5 million — granted to Nadella and other top executives to keep them with the company during the CEO search.
Nadella’s compensation package in fiscal year 2013 was $7.67 million.
Nadella’s compensation package for fiscal year 2015, his first full year as CEO, could have him earning up to $18 million.
Nadella recently made waves when he commented in a women-in-computing conference that women needn’t ask for raises but should trust that the system and good karma will eventually reward them with the pay they deserve. He has apologized for those remarks. He also said in a subsequent interview with USA Today that his answer to that question, about what advice he would give to women who were uncomfortable asking for raises, “which I interpreted super narrowly, was just wrong, because I answered by my own experience of how I managed my career. But the mistake is to take your own personal experience and project it on half of humanity. It’s just insensitive.”
Steve Ballmer, who retired when Nadella took over, had a compensation package of $483,584 in fiscal year 2014, according to the proxy statement. He received a salary of $441,389 and “no Incentive Plan cash award for fiscal year 2014 because he retired before the end of the fiscal year,” the statement said. Ballmer received $1.26 million in total compensation in fiscal 2013. (Ballmer, already Microsoft’s largest individual shareholder and as was his practice, asked not to receive stock awards as part of his compensation.)
Microsoft’s annual shareholders meeting will be held at 8 a.m. Dec. 3 at Meydenbauer Center in Bellevue.
In addition to electing board members, shareholders are asked to take part in an advisory vote on executive compensation, ratify an independent auditor, and vote on a shareholder proposal on shareowners’ ability to nominate board members.