Netflix shareholders reject executive pay packages
Vote comes after a letter from striking writers to Netflix shareholders
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Netflix shareholders withheld support for the company's 2023 executive pay package on Tuesday.
Netflix said the vote tally would be reported in a regulatory filing.
The non-binding "say on pay" vote — which The New York Times noted can be overruled by the board of directors — follows a call by striking writers to reject the proposed compensation to top executives.
"While investors have long taken issue with Netflix's executive pay, the compensation structure is more egregious against the backdrop of the strike," Writers Guild of America West President Meredith Stiehm wrote in a letter to shareholders.
NETFLIX STARTS PASSWORD-SHARING CRACKDOWN IN UNITED STATES
Signage outside the Netflix Inc. office building in Los Angeles on April 19, 2021. (Bing Guan/Bloomberg via Getty Images / Getty Images)
The union said that a vote during the weeks-long strike, which has garnered the support of top Hollywood actors, would be "inappropriate."
Stiehm wrote that if Netflix had the ability to fork out more than $166 million on executive compensation last year, it could afford to pay $68 million a year to writers seeking better compensation.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| NFLX | NETFLIX INC. | 555.12 | -22.39 | -3.88% |
Reacting to the news on Twitter, the Writers Guild of America West said the sum could pay for Netflix's annual share of all proposed improvements for writers twice over.
"It is rare that these shareholder proposals fail – [fewer] than 4% executive compensation shareholder proposals failed in 2022. It’s clear that investors don't believe this management team is worth $160+ million a year," the account tweeted, noting that Netflix's board "needs to spend less time thinking up ways to pay its executive team more money and instead address the writers' strike that is delaying major shows like 'Stranger Things.'"
Netflix headquarters in Madrid on April 30, 2021. (Alejandro Martinez Velez/Europa Press via Getty Images / Getty Images)
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Season four of "Stranger Things" became the most-watched English-language show on Netflix last year, according to Collider.
The guild has made executive compensation for Hollywood executives an issue in negotiations, and it sent a similar letter to NBCUniversal parent Comcast Corp.
In 2022, the Netflix executive pay package won support from just 27% of the shareholder votes cast.
Netflix co-CEO Greg Peters speaks during a keynote about the future of entertainment on the second day of the Mobile World Congress 2023 in Barcelona, Spain, on Feb. 28, 2023. (Joan Cros/NurPhoto via Getty Images / Getty Images)
Subsequently, Netflix said it had made changes, including instituting a salary cap for its co-chief executives and a performance-based bonus plan.
Executive Chairman Reed Hastings is slated to receive a $500,000 salary and $2.5 million in stock. Co-CEOs Ted Sarandos and Greg Peters will both get an annual salary of $3 million. Sarandos stands to receive an additional $20 million in stock and is eligible for a bonus of as much as $17 million, while Peters will collect $17.3 million in stock and a bonus of up to $14.3 million.
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Reuters contributed to this report.