Meeting Date 4/30/2020

Total disclosed compensation for Goldman Sachs CEO David Solomon increased 19% from 2018, to $24,657,737. His pay included an annual salary of $2,000,000 (an increase from the prior year and considerably higher than most S&P 500 company salaries) and a performance stock-based award value at $14,724,012. He also received a cash bonus of $7,650,000. The vagaries of summary compensation disclosure can be confusing, but it is notable that this award appeared under the column “bonus” rather than the more typically disclosed “NEIC” (non-equity incentive compensation. These columns both disclose cash-based awards, but with a critical distinction. The NEIC column discloses cash bonuses that are based on the achievement of metrics. These metrics may or may not be clearly disclosed or reasonably set, but at least they exist. Under prior tax law these were considered performance-based bonuses and thus could offer the company certain tax advantages. That rule (section 162m) has since been replaced, but the vast majority of companies continue to use the NEIC framework and it is strongly favored by shareholders. Goldman Sachs does not list an NEIC column.  

Institutional Shareholder Services (ISS) recommended against the advisory vote on executive compensation because of “pay-for-performance misalignment concerns.” According to Reuters, which received a copy of the report, “ISS wrote that its concerns about Goldman ‘are underscored by a significantly increased CEO bonus for a period when several key financial metrics were down year-over-year.’ The company’s pay programs appear to give its directors too much discretion, ISS wrote.”