Salesforce investors reject plan to add extra $20M to Benioff's total pay

Investors have turned down billionaire Marc Benioff's bid for greater compensation from Salesforce, the SaaS company he helped found 25 years ago, a proxy statement filed on Monday reveals.

Investors voted down a tweak in executive compensation that included a bid to give Benioff a second long-term equity top-up worth $20 million in fiscal 2024, on the grounds that they should be "wary" of such an award.

The board's compensation committee decided on giving Benioff that secondary package of $20 million in equity and stock options in January. The committee said adding a little extra to the CEO's package would "close the gap between the $15 million value" of Benioff's initial fiscal 2024 equity award and what they considered "an appropriately competitive equity opportunity" that would recognize the company's "successful transformation actions and strong financial performance in the fiscal year."

The January pay bump was part of the plan voted down in a non-binding action. The board said it would "consider the outcome of this vote when making future executive compensation decisions."

Benioff's total pay for fiscal 2024 is $39.6 million, a figure that climbed significantly compared to the $29.9 million for 2023.

On top of a "basic" salary of $1.55 million, he receives additional stock and option awards and nonequity incentive plan compensation, according to the proxy statement.

"This has been a remarkable year of transformation for our company – restructuring our business for the short and long term; increasing productivity, profitability, and operational excellence across the board; doubling down on innovation and making our core products even better; and strengthening our relationships with all of you – our stockholders. Our transformation is reflected in the strong results you saw throughout fiscal year 2024," Benioff said in the recent shareholder document.

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However, according to a CNBC report, two companies that offer advice to shareholders, Glass Lewis and Institutional Shareholder Services, were against the additional $20 million award in January. The former suggested "shareholders may reasonably be wary of the substantial discretionary equity grants" owing to a "lack of a fully convincing rationale."

With a $6 billion stake in Salesforce, Benioff is one of its biggest shareholders. Glass Lewis pointed out that this should mean his interests, and those of other shareholders, should already be aligned.

The latest regulatory filing shows shareholders agreed with the advice, voting 339.3 million in favor and 404.8 million against the additional award.

Salesforce has had a bumpy ride in the last couple of years.

In January 2023, activist investors circled, demanding more operational discipline and higher margins in line with other large software companies such as Oracle and Microsoft. At the time it announced it would lay off 7,000 following criticism it struggled to integrate the Slack comms platform after the merger. However, by September, it started recruiting more roles again and activist investors said they would not seek a board role. ®