Netflix bosses want to pay each other more money. However, the shareholders do not agree. But in the end, it will all come down to the sizable pay increases anticipated …
As a US public company, streaming giant Netflix is required by law to disclose significant business activities to authorities. One of those reports, which Netflix filed yesterday, Wednesday, concerns a shareholders meeting last week in which shareholders obviously did not vote in the interest of the board of directors. With a comparatively narrow majority, shareholders voted against plans to significantly increase the salaries of Netflix’s top executives: 158,660,749 votes were received against the proposal and only 158,469,887 votes in favor. (Last year, executive board salaries were approved with a 61 percent majority, so shareholder resistance has exploded.)
According to proposals from Netflix’s board of directors, CEO Reed Hastings and his head of content Ted Sarandos should earn $ 31.5 million (salary + stock options) this year, which would mean an increase of seven and 20 percent. respectively. Under the plan, the pay for the CFO position would rise even more blatantly. The newcomer, Spencer Neumann, should receive roughly double that of his predecessor David Wells, who was still in office in 2018. Compared to the branch newspaper Variety A Netflix spokesperson said after the vote: “The Board of Directors will take the results of the voting into account in its deliberations and will conduct itself in the manner that it believes best suits the interests of the shareholders.“
Shareholders stay small
This PR phrase is based on the fact that the shareholders’ vote is in no way binding: And that the board of directors does not necessarily feel bound by such votes has often been shown in recent years. For example, it has been repeatedly voted that such votes should be binding in the future. Shareholders have always voted for it, but at the same time, the board of directors has never implemented the result, probably also to give itself as much room for maneuver as possible. Netflix shareholders have criticized this approach multiple times and have even repeatedly denied their votes to board members. But this approach was not successful either, because there were no opposing candidates and the proposed candidates entered the board without the required majority.
A development that is undoubtedly completely independent of the high salaries of managers: Netflix prices in Germany increased in 2019 for the standard package and the premium package from € 10.99 to € 11.99 and from € 13.99 to € 15.99, respectively.