Despite criticism over generous executive bonuses, Goldman Sachs has secured majority shareholder support for its executive compensation plan, alleviating concerns about retaining talent amid competition with private equity firms. At the annual shareholder meeting in Dallas, the plan received a 66% approval in a non-binding vote. Goldman Sachs justified the $80 million retention bonuses for CEO David Solomon and President John Waldron as necessary to compete for top talent against well-funded private equity giants.
The plan sparked controversy due to the high retention bonuses, which are not linked to performance. Solomon and Waldron only need to remain until January 2030 to receive the full reward. The "say-on-pay" mechanism, established after the 2008 financial crisis, allows shareholders to vote on executive compensation plans. Although non-binding, companies typically address shareholder concerns following such votes.
Since the 2008 crisis, Goldman Sachs has consistently sought shareholder input on executive pay, usually securing majority support. Last year, despite opposition from Glass Lewis & Co., the plan received 86% support. This year, the firm again opposed the proposal, citing insufficient justification for the $160 million retention bonuses.
