Microsoft CEO Satya Nadella, who hails from India, proved his mettle by turning around the company’s business even though its rivals Apple and Google have catapulted their revenues manifold over the years. Microsoft raked in as much as $500 billion as a market cap over last five years and Nadella made $25.8 million in total compensation. However, he still lags behind his industry peers and is not a part of the list of world’s richest persons.
According to Bloomberg data cited by CNBC, Microsoft co-founder and first CEO Bill Gates is the second richest person in the world with a net worth of $95.7 billion. The company’s second CEO Steve Ballmer has a net worth of $39.2 billion.
According to Microsoft’s most recent proxy statement, in the recent fiscal year that ended on June 30, Nadella received $25.8 million in total compensation, 29% up year over year.
Nadella’s pay was higher than many CEOs in S&P 500 but lower than chiefs of companies like Oracle’s Mark Hurd ($108.3 million), Walt Disney’s Bob Iger ($65.6 million) and 21st Century Fox’s Rupert Murdoch ($50.3 million).
Former Microsoft executive Brad Silverberg told CNBC that whatever the company is paying Nadella, it is not enough.
Nadella had once worked for Silverberg who says that he took into consideration the qualities of India-born executive and thought he will make a good CEO. Silverberg now feels that Nadella has exceeded his expectations.
“I’m really happy with his contributions to the company,” Silverberg told CNBC, adding that the internal culture of the company is good and people are happy there.
“People are really proud to work for Microsoft. I think he’s done a lot to make that happen,” he added.
Brent Bracelin, MD at KetBanc Capital Markets, too said that Nadella is underpaid. “If you look at the stock’s more than doubling in value, clearly one could argue he’s underpaid relative to the wealth creation he’s been able to do in the stock,” Bracelin said.
Steve Herror, a former VMware executive and now MD at General Catalyst Partners, said that Nadella has from all perspectives done an outstanding job and a top-five CEO should have a commensurate package.
When Nadella was made the CEO of Microsoft, Herrod had no Microsoft apps on his phone, but now, he has nine Microsoft apps on his phone. Herrod said that he believes Microsoft has the best mobile email app: Outlook.
Gordon Ritter, founder and general partner of venture firm Emergence Capital said that Microsoft is more open and flexible now. LinkedIn and GitHub have given the company meaningful data. Ritter said that Nadella deserves some kind of additional grant.