Microsoft CEO Satya Nadella Receives 63% Pay Rise Despite Request For Reduction.
Satya Nadella, the chief executive of Microsoft, saw his earnings soar to $79.1m (£61m) over the past year, marking a 63% increase from the previous year. This significant rise came despite Nadella’s personal request to reduce one component of his compensation due to cybersecurity flaws at the tech giant. His request resulted in a $5m reduction from what he might have otherwise received.
Like many major tech companies, Microsoft has faced challenges, including laying off thousands of employees, particularly in its gaming division. However, the company’s overall financial performance remained robust. In a filing with the US financial regulator, Microsoft’s board reported a 16% growth in revenue for the year ending 30 June 2024.
“Mr. Nadella agreed that the Company’s performance was extremely strong,” Microsoft’s compensation committee said in a letter to shareholders. Despite this, Nadella requested that his cash incentive be reduced to reflect his accountability for a series of cyberattacks, including a significant breach in July 2023 that allowed hackers to access the email accounts of around 25 organisations, including government agencies.
While Microsoft attributed the attack to China, the Chinese embassy in London dismissed the claim as “disinformation”. In addition to this, the company faced a massive internet outage in June 2024 affecting Microsoft Windows PCs globally. Although this outage was not related to a cyberattack, Microsoft later apologised for another outage in July that was.
The compensation committee reduced Nadella’s cash pay by more than half, bringing it down to $5.2m, which represents less than 7% of his total earnings. The bulk of his pay package, $71.2m, came from stock options.
Luke Hildyard, director of the High Pay Centre, commented on the CEO’s substantial earnings, acknowledging Microsoft’s strong performance. However, he questioned whether such a large pay rise, on top of the previous year’s $49m, was truly necessary for someone already worth hundreds of millions.
“None of Microsoft’s success would be possible without workers, customers, and wider society, so perhaps the proceeds of that success should be shared a little more evenly,” Hildyard told the BBC.
In comparison with other tech leaders, Apple CEO Tim Cook earned $63.2m in 2023, while Nvidia’s chief executive Jensen Huang received $34.2m for the 2024 fiscal year. However, Tesla’s Elon Musk tops the list, with a pay package potentially worth up to $56bn.
