Goldman Sachs shareholders approved CEO David Solomon’s $24.7 million pay day on Thursday despite calls for it to be voted down in light of the COVID-19 pandemic.
Seventy-one percent of shareholders OK’d the 2019 compensation package, Goldman announced at its annual shareholder meeting. That’s the bank’s weakest pay approval since 2016 and down from 91 percent at last year’s meeting.
The 58-year-old chief executive’s pay — up nearly 20 percent from 2018 — came under scrutiny after proxy adviser Institutional Shareholder Services argued it was out of line at a time when the economy is collapsing and more than 30 million Americans have filed for unemployment.
Many CEOs around the globe are either forgoing their compensation for the year or giving back their annual bonuses in a nod to the unprecedented financial crisis.
It didn’t help that Solomon recently broke with Goldman’s long-held tradition of only renting private jets for senior executives to use on occasion by purchasing two ultra-luxury private jets for a cost reported to cost tens of millions of dollars each.
Goldman also posted disappointing results last year as it weathered more than $1 billion dollars’ worth of legal costs related to the firm’s 1MDB misadventure in Malaysia.
At the meeting, Susan Perez, a portfolio manager at Harrington Investments, asked the $63 billion bank to consider suspending executive bonuses and dividends during the coronavirus crisis.
Goldman’s board said it would keep paying dividends and offered a straightforward, if tepid, defense of his pay during the virtual meeting. Reading from a prepared statement, board member M. Michele Burns said: “We believe David’s compensation is aligned with his peers and his predecessor,” referring to Lloyd Blankfein, who stepped down in 2018.
Burns told shareholders that it’s tough to compare Solomon’s 2019 pay with his 2018 compensation, since he didn’t become CEO until October of 2018. She also emphasized that much of his pay is made up of Goldman stock that he will be unable to pocket for quite some time.
One CEO who made more than Solomon in 2019 is JPMorgan Chase’s Jamie Dimon, who will make $31.5 million. Dimon has been in charge of his bank for almost 15 years. Solomon has helmed Goldman for less than two.