Microsoft CEO Satya Nadella nailed his annual report card -- netting him a cool $25.5 million

Satya NadellaChinaFotoPress via Getty ImagesMicrosoft CEO Satya Nadella.

Microsoft CEO Satya Nadella made just over $US20 million ($AU25.5 million) in cash and stock over the company’s most recent fiscal year, after nailing his annual performance report.

Nadella’s pay package was revealed in Microsoft’s annual shareholder proxy filing, which you can read here.

Basically, half of Nadella’s pay package is based on how well he performs in three key areas: “Product & Strategy,” “Customers & Stakeholders,” and “Culture & Organizational leadership.” Scoring well in all areas netted him a $US7,032,406 bonus on his base salary of $US1,450,000.

His highest score was in “Culture,” where Microsoft’s board praised Nadella’s signature “growth mindset” philosophy. Under the “growth mindset,” Nadella challenges executives and employees to check their assumptions, expect the unexpected, and change their strategy as new data comes in. Nadella scored 145% of his goal in this area.

“The Company widely adopted leadership principles that help its leaders deliver clarity, generate energy, and deliver success,” writes Microsoft’s board in the proxy statement.

His next highest score was 125%, in “Customers & Stakeholders.” Here, the board praises progress in “the perception of Microsoft as an innovator and as a leader in the cloud.” The filing also highlights Microsoft’s well-received programs around bringing broadband internet to rural areas, as well as other philanthropic initiatives.

Last, and least, was his score of an even 100% on “Product & Strategy.” The board rated him highly for the rapid growth of Microsoft’s $US18.9 billion cloud computing business, which encompasses the Azure cloud platform, as well as the Office 365 productivity suite.

However, Nadella was dinged points for the 2% decline in Surface revenue in 2016 versus 2015, as well as the lagging market share of the Microsoft Edge web browser versus the leader, Google Chrome.

The board was also happy enough to award Nadella $US11,434,557 worth of Microsoft stock. Add in an extra $US97,189 for miscellaneous compensation that includes matching charitable gifts, and it comes out to $US20,014,152 total.

This was actually Nadella’s best year as Microsoft CEO yet, at least in terms of his personal fortune: In the previous fiscal year, Nadella took home $US17,692,031, with the wind-down of Microsoft’s smartphone business hurting his bonus.

Get the latest Microsoft stock price here.

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