Netflix shareholders voted against the support for the Netflix executive compensation structure for 2023 in a non-binding ‘say on pay’ vote on Thursday. The rejection vote for the executive pay package comes as the streaming giant is under pressure due to ongoing strike.
Writers Guild strike
With the ongoing Writer’s strike march with signs on the picket line in early May with its members demanding higher pay. More than 11,000 Hollywood television and movie writers are on their first strike since 2007 after talks with studios and streamers over pay and working conditions failed to clinch a deal. Striking Hollywood writers have lambasted media companies for paying their executives too much money. The writers say they are asking for an increase in salary that is less than a handful of moguls make per year.
Investors rejects high pay of Netflix executives
Netflix shareholders voted on Thursday to reject multi-million dollar pay packages for the company’s top executives including for co-CEOs Ted Sarandos and Greg Peters. Shareholders’ rejection of the compensation packages comes as the streaming giant is under pressure after more than 11,000 television and film writers went on strike last month following the breakdown of negotiations between the Writers Guild of America and Hollywood studios.
Netflix’s stock has jumped 36% to $401.45 this year. In the first quarter of 2023, the company’s revenue increased to $8.16 billion from $7.87 billion in the year-prior quarter, the company’s SEC filing shows.
Netflix Shareholders Vote on the non-binding “say-on-pay” advisory measure at Netflix’s annual meeting on Thursday, with the result coming just days after the WGA had urged investors to oppose the lucrative pay packages in a show of support for Hollywood writers’ efforts to secure better pay and job security.
It remains unclear when the streaming company will hold its next board of directors meeting.
They rejected a pay package that would reward co-CEOs Ted Sarandos and Greg Peters with salaries of $3 million, plus more than $30 million each in stock options and bonus payments. But because the vote is non-binding, the company’s board may ignore its outcome and approve the compensation packages at its next board of directors meeting.
Pay for Hollywood’s top executives has skyrocketed in recent and writers who are striking say firms should dole out the cash more evenly rather than lining the pockets of a few mega-rich bosses.
Meanwhile, CFO Spencer Neumann will get a $7 million salary and $7 million in stock options, while Chief Legal Officer David Hyman is slated to get a $4 million salary and $7 million in stock. Chief Communications Officer Rachel Whetstone will get a $5.7 million salary and $800,000 in stock.
In total, the payouts are worth up to $166 million.
The median Netflix employee made $218,400 in 2022, according to a Securities and Exchange Commission filing. That would make the ratio of CEO pay to median employee pay 234 to 1.
The guild’s president, Meredith Stiehm, said: ‘While investors have long taken issue with Netflix’s executive pay, the compensation structure is more egregious against the backdrop of the strike.’
Stiehm wrote that if Netflix had the resources to spend more than $166 million on executive compensation last year for its top executives, it can afford to pay $68 million a year to writers seeking in better compensation.
