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Executive compensation at apple and microsoft compared

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Executive compensation at apple and microsoft compared

  1. 1. Comparison of Executive Compensation at Apple & Microsoft
  2. 2. Comparison of Executive Compensation at Apple & Microsoft
  3. 3. What is Executive Compensation? Executive Compensation is a broad term for - the financial compensation awarded to a firm's executives. Executive Compensation packages are designed by a company's Board of Directors, typically by the Compensation Committee. There are four distinct characteristics of Executive Compensation.
  4. 4. Executive Compensation should Ensure that it Achieves Four Basic Objectives : - Focuses pay to achieve specific desired results - Attracts qualified candidates to the organization - Retains executives for the long term - Motivates executives to keep them engaged in their work Prezi "U u‘
  5. 5. Recent Trends of Executive Compensation A heady stock-market pushed pay for chief executives up at the fastest rate I in years in 2013. CEO pay rose a 1 median of 5.5% to $11.4 million last year, according to The Wall Street Journal/ Hay Group CEO Compensation Study, which analyzed data from the 300 largest companies by revenue. Avg. CEO compensation= 31 times Avg. Worker compensation
  6. 6. if .1.’ ‘I32 1-5;, Z,(7-. lCZ| .,l‘. lIfl! lf-. .' C; ci; ii, i_gi; i.i. i;ii. it7i-in -.11? At? ‘ Total Executive Compensation AAPL 483 mil 322 mil 161 mil Stock Price 100. 00 50.00 0. DC‘ 436.61 mil 346.41 mil 178.02 mil 18.27 mil 1430 mu m . T 2009 2010 2011 2012 2013 1 1 man l‘. in ('1 lli'I ‘. E ‘LE , l_'i, iC‘. . 1013 Executive Com pensation Total Com pensation $14,798,388 1-Year % Change -95.73 Compensation vs. Performance 1-Year % Change CEO Compensation 1,86% Stock Return 7.64% Revenue 6,959/0 Retum on Equity .21.55% Net Income 5.530/0
  7. 7. I‘ Key Executive Compensation AAPL bee 3.11.11, 1.. c‘illL: 1.1, 1121.1 1. lL)l 11. AAPL Name/ Title 2009 2010 2011 2012 2013 Key Executive Com pensation 3,061,034 1,641,317 1,419,717 88,889,238 59.092 ,572 29,796,666 432,365,655 377,996,537 1,416,143 191,373,531 4,174,992 68,591,562 14,793,393 4,252,727 2,632,852 Timothy D. Cook/ Chief Executive Officer Peter Oppenheimer/ senior vice President and Chief Financial Officer L Eduardo H. Cue/ Senior Vice President, Internet Software - - 52,952,975 50,420,415 2,647,105 and Services ‘‘ Jeffery Williams/ Senior Vice President, Operations - - - 68,691,612 2,632,852 Daniel J. Rlcclo/ Senior vice President, Hardware - - - - 2,632,852 Engineering v v 1.c1.ii1,1i: t 1111,1111 1 L. ‘ my-1 '1; : i11, , ‘1l'i0lill 1'11.i1,1.1. .1‘ can 3-. «. ..:11.1 111,, ->11,'i, t;1r1t1.1 . -11 1111-, | A 11,;1i11.i,1t w 1--11 il‘.1— 1'11, . liv 11 -1- 11.1 .11111ni.1~111v 1. mm. 111,111 lr'1 iin'i11i an‘ 51.1 tine T ‘P. '| li! nr_l1_l]IL'iIoZ ‘ n D:
  8. 8. him as many as 2.7 million shares over the next seven years. Growth of Executive Compensation at Apple Inc Four of the five highest-paid employees at Standard 8: Poor’s 500 companies aren't chief executive officers. They're Apple Inc. (AAPL) senior lieutenants receiving compensation packages designed to keep management intact in an increasingly competitive industry. Apple uses a metric called TSR, a combination of share price appreciation and dividends paid to shareholders. Apple uses three-year TSR measurement that started in March 2014 and will continue till April 2017.
  9. 9. ~ a 3*. ;:. (:-ic: .I. Iir: iv: .: CL! I_I_’I_lV: I;l. IEl! .Iifl@In . -.. IiI_lll. l.lc: .'r’c1;idf', iI -A i i 10/30/2014 MSFT Microsoft Corp Executive Compensation Total Executive Compensation MSFF 2014 Executive Compensation l 168 mil Total Compensation 1-Year °/ o Chang $152,076,162 294. 112 mil Compensation vs. Performance 1-Vear % Change it use Compensation 99935% T l 55 "‘" 33.03 mil . 33.60 mil 33-52 "'" Stock mum 43'69% 1' 27.60 mil , - - 1 Revenue 1154,, /0 . * l V 1 V V Retum on Equity .13_o3o/0 V. ‘ 2010 2011 2012 2013 2014 Net Income 037% Stock Price l‘ 50.: -c« ‘ll {'1 40-00 Ii ZCMCID Ki '}7f‘; 6 Merry ll HCU if l I ' r I i . . T V :3 if A gnu. s — = F i ; _.— . . . H. _ ‘ l ‘RV . 4 ll lfil” W V II l L‘ U I 1 r V ' l V _ IL I | | l I . . I I I l
  10. 10. - 1 Key Executive Compensation MSFT Name/ Title Key Executive Compensation Satya Nadella/ Chief Executive Officer and Director Steven A. Ballmer/ Former Chief Executive Officer and Director Amy Hood/ Chief Financial Officer B. Kevin Turner/ Chief Operating Officer Harry Shurn/ Executive Vice President, Technology and Research Bradford L. Smith/ Executive Vice President and General Counsel 1' vrlwt "Jr'nat1i“' : ~w: ei— rt, ~-= Ff". "rilf‘l av-ir type 3' 'o'n.7r—"'. — r ii ‘i 2010 2011 2012 2013 2014 9,265,630 10,654,056 12,001,799 26,774,352 152,076,162 - - 7,668,952 84,308,755 1,351,121 1,376,915 1,318,128 1,261,218 483,584 — — 7,460,569 10,463,058 7,914,509 9,277,141 10,683,671 10,383,613 22,719,276 — — 17.136.686 — — 16.964.503 R’ “.1 73 F '0 is (R) and 1'79 ‘7'>'—e= mire iT‘L'15' i’ F. ‘ V raw lii‘. i’i -l Way 1 HM. ‘ vvl~ 'il w 1-’ rr . ' . . iii)’ ill il 1 illl iii» 4 : *'r; ;u1‘i -'1 , » fl ITTU"
  11. 11. Growth in Compensation of Microsoft CEO WHO IS SATYA NADELLA Age: 46 tronics from Manipal Bom: Hyderabad University EDUCATION I MSc in computer I Hyderabad Public science from School, Begumpet Wisconsin university I Bachelor of I MBA from University Engineering in elec— of Chicago CEO Steve Ballmer's annual salary was $697,500, or 42% less than Nadella's. His total compensation package for the 2015 fiscal year, which starts July 1, could be as much as $18 million, or 144% higher than the $7.6 million he received in fiscal 2013. Microsoft is also kicking in a one-time stock grant, dubbed LTPSAs, that could hand him as many as 2.7 million shares over the next seven years.
  12. 12. mu Executive c. ... .e. .mi. .- Cnlnpellsllion n. Ieflormanee {I—V9isi “A4 Elluiiqef mmi ramimiserian 1—Yeai at rhmoe cm €0"Vner‘. <«>.1ini1 S’i>i| ( Pleiliih Revenue mum on rtilllfv Net Irr. /aine 2., I 55% 1 54% 505% 7155% (1 now Total Executive Compensation AAPL 15; "Ill 436.61 ni um”: izzmii mm»: 161 mu II-17-III moo nil j . . j mm 21110 mi zmz 2013 stock Price mac: 5: [it U1‘ 103012014 MSFT Microsofl Corp Executive Compensation Total Executive compensation li'E: ;T 2014 suaume tompensnlion M "V" mm M. Iaral Lnmnirslrinn H. .. Wu mm V $152,076,162 294.81 Ilzrii-I tomoenlltionvs. nnm-. .m rev. -am. crate rm rerpensniian 999.35% 36 IVVV‘ Sam I“ _ nm ".1 3”: Ni Stock Reruir 43.59% 77-5‘‘''“' Nevérue u, g,4u, ., , new on 9.-an ~1.i. u3"/ u 2010 1011 1011 um zoio M‘ mm D 97% stock rm. s: cc
  13. 13. Comparison of Executive Compensation at Apple & Microsoft

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