Goldman Sachs is catching recent warmth over large bonuses it has pledged to CEO David Solomon and his No. 2 govt John Waldron — with highly effective shareholder voting advisors slamming the payouts as “excessive” and “poor practice.”
A pair of so-called proxy advisory corporations, which counsel traders on the right way to vote on the annual conferences of massive public corporations, ripped an $80 million retention bonus for 63-year-old Solomon — a lavish sum that sparked outrage among the many rank and file when the financial institution revealed it in late January.
Goldman is also handing out an $80 million retention bonus to John Waldron, the Wall Road large’s 55-year-old working chief who not too long ago has turn into the reported frontrunner to ultimately succeed Solomon, in line with securities filings.
In a report printed late on Monday, Institutional Shareholder Providers known as the payouts “poor practice,” griping that the proposed packages “lack rigorous, pre-set performance criteria, which is particularly concerning for off-cycle awards with such large values.”
Within the word to shoppers, ISS known as on shareholders to vote in opposition to the lavish bonuses at Goldman’s April shareholder assembly, citing the “magnitude and structure” of the golden handcuffs funds that may absolutely vest in 5 years.
ISS’s assault adopted an analogous broadside from influential proxy adviser Glass Lewis on Friday, which ripped Goldman over its “continued inability to align pay with performance.”
The issue is “exacerbated by the decision to grant excessive retention awards to Messrs. Solomon and Waldron just following the end of the fiscal year,” Glass Lewis wrote in its personal report.
“The provided discussion regarding the rationale in the proxy statement is far from robust,” the agency added.
The attention-popping sums, topic to being signed off by the financial institution’s compensation committee, have been seen as a play to maintain Solomon and Waldron with the agency.
Final month, the Monetary Occasions reported that Waldron was eyeing a $500 million job in personal fairness with Marc Rowan’s Apollo International Administration.
Defenders of the payouts have likewise pointed to Goldman’s surging income, currently fueled by a rebound in buying and selling, which have despatched its share value rocketing by greater than 30% over the previous yr.
A Goldman Sachs spokesperson famous that the awards will come completely within the type of firm inventory.
“Competition for our talent is fierce. The Board took action to retain our current leadership team, to sustain our firm’s momentum and maintain a strong succession plan,” a Goldman Sachs spokesperson advised The Publish. “A 100% stock-based grant is fully aligned with long-term shareholder value creation.”
Final yr, in his annual letter to shareholders, JPMorgan CEO Jamie Dimon — who in 2021 was awarded a $50 million retention bonus that vests subsequent yr — slammed each corporations for wielding “undue influence” and recommended that their voting suggestions have been biased.
There was additionally additional controversy at Goldman on Friday when Enterprise Insider reported on how the financial institution was planning to rent a company aviation affiliate to arrange govt personal jet journey.
The publish will see the fortunate candidate rake in as much as $160,000 a yr for managing the schedule of the financial institution’s two Gulfstream jets, which The Publish has dubbed Air Pressure Sol.
“Goldman Sachs appreciates the help recruiting top talent for this job, in yet another New York Post article about our corporate aviation,” the Goldman Sachs spokesperson ranted.
“The fact that Goldman needs a full-time employee to manage its fleet of private aircraft is another testament to the expansive reach of Goldman’s executives,” mentioned Luke Perlot of the Nationwide Authorized and Coverage Heart, a right-leaning company activist group. “We still think the private aircraft are a waste of shareholder resources.”
The jets embrace a bigger Gulfstream G650 ER that’s primarily utilized by Solomon and a G280 that’s normally utilized by Waldron.
Their two name indicators — N650WS and N280WS — are a nod to Wall Road and the agency’s 200 West Road headquarters in downtown Manhattan.
A Publish evaluation of personal monitoring knowledge exhibits that the corporate’s plane flew to the Bahamas as many as 29 occasions in 2023 and 2024.
Many of the flights to the Bahamas passed off at weekends or round vacation intervals, the information exhibits
The tropical archipelago is the place Solomon has a beachside residence within the luxurious 600-acre Bakers Bay improvement on the tiny island of Nice Guana Cay, simply an eight-mile boat trip from Marsh Harbour.
“I guess he was just working from home,” joked one Goldman Sachs staffer in a thinly veiled swipe at Solomon’s famend opposition to distant working.
