- A year after Salesforce cut CEO Marc Benioff’s total pay and froze other top executives’ pay to appease shareholder complaints, the company has decided to loosen its purse strings.
- While Benioff isn’t getting a salary bump, several of his top officers are getting raises which impact their salaries and their bonuses.
- If Salesforce hits its cash flow and growth targets, COO Keith Block could take home $US2.5 million in its 2019 fiscal year – $US200,000 more than he could have previously.
A year ago, Salesforce made headlines when it gave its flamboyant founder, CEO Marc Benioff, a 60% pay cut and froze his salary and cash bonus in response to investor concerns that its executive pay and perks were excessive.
Other top Salesforce executives saw their salary and bonuses frozen for the cycle, too. The salary of cofounder and CTO Parker Harris was the same in Salesforce’s 2018 fiscal year as it was in FY17, the company has revealed in regulatory filings. The same is true for COO Keith Block, Benioff’s right-hand man and a former top-paid Oracle sales exec.
But Salesforce’s 2019 fiscal year just kicked off in February, and it’s ushered in a $US100,000 raise each for Block and Harris, according to anSEC filing made on Friday afternoon. For his part, Benioff did not get appear to get a salary increase for FY2019.
Block previously drew a base salary of $US1.15 million – and will now earn $US1.25 million in FY19, according to the filing. Harris was bumped from $US900,000 to $US1 million, and CFO Mark Hawkins got an even bigger pay raise from $US750,000 to $US900,000,
These execs are still eligible for bonuses equal to 100% of their salaries, as they were in years past. That means that if Salesforce meets its cash flow and growth targets, Block would make $US2.5 million in the 2019 fiscal year, and Harris would make $US2 million. That means that the $US100,000 raise would effectively get doubled to $US200,000, too.
In reality, though the cash raises are only a small part of these executive’s compensation packages – their total pay is really a mixture of cash and stock awards, as well as other perks.
For instance, Block earned total compensation of $US12.4 million in FY2017, up from about $US12.3 million in FY2015. That includes over $US47,356 of expenses paid in 2017 to have him attend company sales events, including buying him some new clothes, the company said.
But these $US100,000 pay raises are still sort of a big deal, because in 2016, the company heard from investors concerned about executive pay and perks.
The board listened, cut Benioff’s total pay – including stock – by 60%, froze his salary and cash bonus for a couple of years, reduced how much it paid for Benioff’s personal security, and expanded the use of stock awards based on performance for all the named executives.
Specifically, Benioff was paid $US13.2 million in FY2017, including $US1.3 million of “other compensation” which covered his security detail. This compares to the $US33.4 million he earned in 2017, and the just under $US40 million he earned in 2016.
Not that he’s hurting for cash. Benioff is worth $US5.3 billion,according to Forbes, and still holds about 33.4 million shares of the company he founded. And he sells his shares routinely and frequently.
Benioff’s base pay remains $US1.55 million, as does his cash bonus of up to 200% of his salary or $US3.1 million. However, the filing did mention that the compensation committee “approved changes” to his pay, but didn’t specify what those changes might be. Salesforce did not immediately respond to our request for comment.
To be fair, the board has good reason to be happy with Salesforce’s top management.
Salesforce has been growing revenue like gangbusters for the past few years, on track to do over $US10 billion in its fiscal 2018. The stock is up about 43% over its year-ago price.
And now executives have been promising investors that they will grow the company’s revenue some 600%, to $US60 billion in 15 years. If they achieve this ramping-up – and it is certainly possible that they can – Salesforce’s board, and its investors, will likely be happy enough to reward them.