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> Jassy's executive compensation package, which is tied to Amazon stock price and mostly delivered as stock awards over a multi-year period, was $212 million in

by ctvo 4y ago

> Jassy's executive compensation package, which is tied to Amazon stock price and mostly delivered as stock awards over a multi-year period, was $212 million in 2021. They used "multi-year" here over the actual timeline: 10 years. It sounds a lot less outrageous that his pay is heavily based on the stock price and comes out to be ~21 million a year as the head of one of the largest tech companies in the world. Here are the details: > Virtually all of Jassy’s 2021 comp — $211.9 million — was in restricted stock that vests over the next 10 years, according to Amazon’s proxy statement filed Friday. His base salary was $175,000, unchanged from the two prior years; in addition, Amazon paid $589,149 in security expenses for the CEO. From Variety https://variety.com/2022/digital/news/amazon-andy-jassy-2021-compensation-stock-1235220961/ https://variety.com/2022/digital/news/amazon-andy-jassy-2021... Edit: > The Amazon board’s compensation committee said in the filing that it intends for Jassy’s stock award, which vests through 2031, “to serve as a long-term incentive for Mr. Jassy, and, accordingly, believes it should be viewed as compensation over the 10-year term and not solely as compensation for 2021.” Doesn't sound like he'll get too many more RSUs yearly.

colechristensen 4y ago
But does he get another 200M package that vests over ten years next year?
- __derek__ 4y ago
  Assuming that Amazon's executive compensation continues to function as it has for the last decade-plus, no.
- mjw1007 4y ago
  And does he still get the 2021 package if he doesn't continue working in that role for the following nine years?
  - devman0 4y ago
    Generally that isn't how RSU vesting schedules works. You only keep what has already vested if you leave.
    - colechristensen 4y ago
      For a CEO with a $200M package, everything is negotiable and would depend highly on the mode of departure.
Kerrick 4y ago
That $212 million was starkly contrasted by the next point in the article, that Warehouse workers typically make $15/hr. It would take about 7,000 years working that wage (full-time) to make the same $212,000,000. It's still a _huge_ gulf, whether the CEO's compensation is in one year or one decade.
- Auracle 4y ago
  Right, but if you were to take all $212 million and divvy it up to the nearly 1 million US Amazon employees it wouldn’t go very far.
  - sjsdaiuasgdia 4y ago
    I see this theme a lot when this topic comes up, and I feel it misses the point. Does the CEO provide 700x the value (based on $21.2M / 2000 hrs = $10600 "hourly rate") of a warehouse worker earning $15/hr? They absolutely provide critical input and decisions at the helm of a large ship, but if you break down their input versus the input of everyone under them...is it actually such a huge disparity of mental and physical effort to warrant a 700x difference in pay? Secondly, if the company wasn't spending that much on CEO compensation, the money could go plenty of places beyond sprinkling pennies at warehouse workers. Infrastructure investment, product development, or other ways to grow the business. Employee wellness programs, crisis/hardship assistance, etc to support the workforce. Looking at it as only CEO salary divided by employee count is a very limiting perspective that ignores a lot of potential ways that pile of money can be used besides making a very rich person a bit richer.
    - egberts1 4y ago
      For a penny an hour by a CEO who performs 400x that of an average Amazon employee, that’s a bargain.
      - gtvwill 4y ago
        Your dreaming or delusional if you think a CEOs output is 400x someone else's. Dangerously delusional.
xiaosun 4y ago
The award is for 61000 shares, which would have been worth $212M as of the 12/31/2021 share price. It's worth far less now. Quite frankly, this is as sensible of a comp package for a CEO as one could propose. Compensated in primarily in equity with a long horizon for vesting. If a company wanted its executive to be aligned with the interests of its shareholders, is there really a better structure? Aligning the incentives of the CEO to the incentives of shareholders by awarding the equivalent of an 0.012% ownership stake seems reasonable to me.
redisman 4y ago
Hah sounds like a lot of HNers have Andy Jassy beat on base salary
- reasonabl_human 4y ago
  I’ve always wondered how this works- sure these folks are already personally wealthy, and they have large stock portfolios, but the mechanics of tapping into that for liquidity is interesting to me.. Say an exec makes Jassy’s base and has a large equity packages. Do banks feel comfortable writing loans against to-be-vested RSUs? I’d imagine they count RSU vesting as heavily discounted future cash flow.. but not sure. Plus there is significant volatility in the actual value they bank at the end of the day- sure, speaking on normal terms having an equity package fluctuate at this scale isn’t significant to an individual’s finances, but might be to a bank underwriting, say, a recent Snap exec’s loans…

by ctvo 4y ago

colechristensen 4y ago

But does he get another 200M package that vests over ten years next year?

__derek__ 4y ago
Assuming that Amazon's executive compensation continues to function as it has for the last decade-plus, no.
mjw1007 4y ago
And does he still get the 2021 package if he doesn't continue working in that role for the following nine years?
- devman0 4y ago
  Generally that isn't how RSU vesting schedules works. You only keep what has already vested if you leave.
  - colechristensen 4y ago
    For a CEO with a $200M package, everything is negotiable and would depend highly on the mode of departure.

Kerrick 4y ago

That $212 million was starkly contrasted by the next point in the article, that Warehouse workers typically make $15/hr. It would take about 7,000 years working that wage (full-time) to make the same $212,000,000. It's still a _huge_ gulf, whether the CEO's compensation is in one year or one decade.

Auracle 4y ago
Right, but if you were to take all $212 million and divvy it up to the nearly 1 million US Amazon employees it wouldn’t go very far.
- sjsdaiuasgdia 4y ago
  I see this theme a lot when this topic comes up, and I feel it misses the point. Does the CEO provide 700x the value (based on $21.2M / 2000 hrs = $10600 "hourly rate") of a warehouse worker earning $15/hr? They absolutely provide critical input and decisions at the helm of a large ship, but if you break down their input versus the input of everyone under them...is it actually such a huge disparity of mental and physical effort to warrant a 700x difference in pay? Secondly, if the company wasn't spending that much on CEO compensation, the money could go plenty of places beyond sprinkling pennies at warehouse workers. Infrastructure investment, product development, or other ways to grow the business. Employee wellness programs, crisis/hardship assistance, etc to support the workforce. Looking at it as only CEO salary divided by employee count is a very limiting perspective that ignores a lot of potential ways that pile of money can be used besides making a very rich person a bit richer.
  - egberts1 4y ago
    For a penny an hour by a CEO who performs 400x that of an average Amazon employee, that’s a bargain.
    - gtvwill 4y ago
      Your dreaming or delusional if you think a CEOs output is 400x someone else's. Dangerously delusional.

xiaosun 4y ago

The award is for 61000 shares, which would have been worth $212M as of the 12/31/2021 share price. It's worth far less now. Quite frankly, this is as sensible of a comp package for a CEO as one could propose. Compensated in primarily in equity with a long horizon for vesting. If a company wanted its executive to be aligned with the interests of its shareholders, is there really a better structure? Aligning the incentives of the CEO to the incentives of shareholders by awarding the equivalent of an 0.012% ownership stake seems reasonable to me.

redisman 4y ago

Hah sounds like a lot of HNers have Andy Jassy beat on base salary

reasonabl_human 4y ago
I’ve always wondered how this works- sure these folks are already personally wealthy, and they have large stock portfolios, but the mechanics of tapping into that for liquidity is interesting to me.. Say an exec makes Jassy’s base and has a large equity packages. Do banks feel comfortable writing loans against to-be-vested RSUs? I’d imagine they count RSU vesting as heavily discounted future cash flow.. but not sure. Plus there is significant volatility in the actual value they bank at the end of the day- sure, speaking on normal terms having an equity package fluctuate at this scale isn’t significant to an individual’s finances, but might be to a bank underwriting, say, a recent Snap exec’s loans…