Its 21M, 210M is over 10 years with substantial part of that not vesting until year 8. That said it's still pretty rich given its not tied to shareholder value or business performance.
The sad truth is that, in recent years, performance doesn't seem to be pegged to compensation anymore.
Not only that, but certain large corporation CEOs do have provisions in their contracts so they get paid handsomely if they are fired, which goes against the very idea of firing people for performance reasons.
If you tie comp to share price or EPS, they'll try to juice it with buybacks.
If you tie it to revenue, they'll try to grow too quickly and become unsustainable. They'll start doing anti-consumer things like denying refunds.
If you tie it to profits, they'll cut the business down to barebones and whittle away at resiliency and R&D in order to squeeze a bit more margin out each quarter.
Like Warren Buffett's co-ceo Charlie Munger once quipped, "show me the incentives and I'll show you the outcome".
I worked at a company that wanted to do this, and may or may not have behind the scenes.
When I explained that these could easily be gamed, their response was, "Why would someone do that?"
This was at one of the largest banks in the entire world while they were also trying to claim that they were a technology company that happens to do banking. Yeah, okay.
It works similar in sports, if there is a 33 year old free agent superstar, every team is willing to give them a 2 year 80million dollar deal (40 per year). So the competition becomes who is willing to guarantee 40 for a 3rd, 4th year.
It may not be a great long term decision for the team, but if they dont agree to those unfavorable terms they're simply not getting the player.
I wonder if there were other companies willing to offer similar payment packages to this CEO and the competition become who would guarantee the money without asking for performance goals.
Main difference here is that the average career span of a pro athlete very rarely reaches 20 years, and deal numbers tend to decrease with age. Executives don't have that problem, in fact it's quite the opposite.
The average age of a CEO in 2018 is 54 years old [1], so I would say yes, they do. The average salary for a CEO in a top 350 company was $13.9M [2].
> They also start getting those paychecks later in their 30s compared to sport players
Compared to the average NFL player ($860,000) [3], and the average retirement age is 27 years old [4], which essentially means that an average NFL player makes perhaps 5 to 6 million dollars in their whole career. Other more forgiving sports, like NBA, puts players on an average of $8 million [5], and an average retirement age of 28 [6], so around 6-7 seasons.
It's worth remembering that these are highly paid professional athletes who most likely come from college teams, meaning that they weren't paid at all.
A CEO, on the other hand, doesn't spend their previous years as an unpaid intern. They are usually top executives already.
In short, CEOs do get paid better on average than professional athletes, all things considered.
[1] https://www.statista.com/statistics/1097551/average-age-at-h...
[2] https://www.epi.org/publication/ceo-pay-in-2020/#:~:text=Thi....
[3] https://work.chron.com/much-money-nfl-player-make-year-2377....
[4] https://investingfuse.com/retirement/average-retirement-age-....
[5] https://www.statista.com/statistics/1120257/annual-salaries-....
[6] https://www.rbcwealthmanagement.com/en-us/insights/professio...
I worked a lot with Andy jassy, he’s worth the investment.
Are you claiming he will get this award every year?
He doesn't "just have to wait". He has to WORK for 10 years or meet other requirements for vesting.
If this was a european style 10 year option package, sure, he could retire and just wait to excercise, that's not what these are.