Is Oracle Corporation (NYSE:ORCL) CEO Underpaid?
Larry Ellison the long serving CEO of Oracle Corporation (NYSE:ORCL) missed his key note address slot during the tech’s major annual jamboree “Oracle Open World” as he was busy cheering the Oracle racing team to win the America Cup sailing tournament which happened on September 24. The 69-year old was an active participant of the racing team.
Ellison’s pay-check dips
In Oracle Corporation (NYSE:ORCL)’s SEC filings of 2013 Proxy statement, the annual compensation for the founder-CEO of Oracle Corporation (NYSE:ORCL) in FY13, stood at $78.4 million compared to $96.16 million in FY12. The lesser compensation for the CEO was attributed to the failure of the company not meeting its internal financial targets in the past three quarters.
“Our CEO and Presidents received no cash bonuses in fiscal 2013. For fiscal 2013, the target bonuses were $6.1 million for Mr. Ellison and $3.7million for each of Ms. Catz and Mr. Hurd. But given Oracle’s results-aligned executive bonus plan and fiscal 2013 growth that did not meet Oracle’s own internal growth expectations, Mr. Ellison was eligible for a bonus payment of approximately $1.2 million, and Ms. Catz and Mr. Hurd were eligible for bonus payments of approximately $717,000. And given Oracle’s pay-for-performance philosophy, they all voluntarily declined their fiscal 2013bonuses and therefore received no bonuses.It is also reported that Ellison, has also turned down his annual cash bonus of $1.2 million, in view of the overall company performance.“
Does dilution of shareholder stock make its way into Larry Ellison’s personal stock holding?
Investors feel that Larry Ellison end’s up earning millions every year in the form of vested shares that get allotted to him by dilution of existing share holder stock. Shareholders also believe that the share allotments are not based on performance of Oracle Corporation (NYSE:ORCL).
The recent disgruntlement by investors towards Larry Ellison’s high annual earnings is not for the first time. Similarly it has happened in past as well.