Goldman Chief Blankfein Took 4% Pay Cut for 2016
By Liz Hoffman
Goldman Sachs Group Inc.'s board cut Chief Executive Lloyd Blankfein's pay by 4% and tied more of it to how the bank does for its investors in coming years.
Mr. Blankfein received $22 million in total pay for 2016, according to a regulatory filing Friday. His $2 million salary remained unchanged, while his cash bonus fell to $4 million from $6.3 million last year. He also received about $16 million in stock awards, up from $14.7 million in 2015.
Harvey Schwartz, who was recently promoted from chief financial officer to co-chief operating officer, was paid $20 million in 2016, down from $21 million from a year earlier. Pay at the top of Goldman tends to be flatter than at some other big banks, with Mr. Blankfein's top deputies making almost as much as the CEO.
Goldman's revenue fell 9% in 2016, dragged down by a slow first half of the year. Many other top Goldman executives had pay cuts of around 5%.
Goldman also tied more of Mr. Blankfein's pay to the bank's performance. All of his stock-based bonus was delivered in units that pay out based on Goldman's returns over the next few years. In 2015, only half of the bonus was tied to future returns; before that, none was.
Investors generally like to see executives' fortunes tied to their own. The changes come after just two-thirds of shareholders approved the 2015 pay plan. Goldman's directors "viewed this outcome as an indication that further engagement was needed" and spent the fall getting feedback from investors.
In another nod to shareholders, Goldman's returns will be judged relative to its banking peers, not on an absolute basis.
Based on the Securities and Exchange Commission's methodology, Mr. Blankfein received $20.2 million in 2016, though some of that was tied to his package for the year before.
Write to Liz Hoffman at [email protected]