Introduction
Context
Proxy Adviser Recommendation
Glass Lewis has urged investors to vote against the executive compensation at Goldman Sachs, highlighting concerns regarding the bank's failure to link pay with performance and the scale of retention grants deemed excessive.
Developments
Retention Awards Analysis
In its late Friday report, Glass Lewis pointed out the combined $160 million in retention awards granted to CEO David Solomon and President John Waldron. The adviser intends to evaluate the impact of these awards on pay and performance alignment more comprehensively as part of the discussions leading up to 2025. However, the initial rationale provided in the proxy statement has been criticized as inadequate.
Company Response
A spokesperson for Goldman Sachs defended the board's decision, stating that "competition for our talent is fierce." The spokesperson emphasized that the board's actions were necessary to retain the leadership team, maintain the bank's momentum, and ensure a solid succession plan. Additionally, the spokesperson highlighted that the retention awards are 100% stock-based, designed to align with long-term shareholder value creation.