NEW YORK—Investment Bank Goldman Sachs Group Inc. has boosted the base pay of its chief executive officer Lloyd C. Blankfein by more than two-fold, from $600,000 to $2 million, the company said late last week.
Goldman, which like other investment banks is under pressure from the federal government and other stakeholders to reduce bonuses, has increased the base pay of its executives and partners while reducing their performance-based bonuses.
The move, critics hope, will shift executives’ focus from short-term gains to long term profitability.
The company’s pay increase for its executives and partners is the first of its kind for the firm since going public in 1999.
At the same time, Blankfein will receive a one-time stock award worth $12.6 million.
The company’s Chief Operating Officer Gary Cohn and Chief Financial Officer David Viniar also received raises, according to a Securities and Exchange Commission filing last week.
The move comes at the heels of Goldman reporting a 38 percent drop in net income for 2010. Nevertheless, the company set aside 39 percent of its revenues for compensating employees, the second-lowest percentage since 1999, according to a Wall Street Journal Report.
Goldman’s move follows that of other banks, which have recently boosted executive pay, while decreasing bonuses and increasing stock-based compensation.
Vikram Pandit, the CEO of U.S. bank Citigroup Inc., received his first raise after taking in $1 since becoming the bank’s chief and vowing to not receive additional base compensation until the bank made a profit.
Two weeks ago, after Citigroup announced its first annual profit since 2007, Pandit received a large raise to boost his base salary to $1.75 million per annum.
Goldman, which like other investment banks is under pressure from the federal government and other stakeholders to reduce bonuses, has increased the base pay of its executives and partners while reducing their performance-based bonuses.
The move, critics hope, will shift executives’ focus from short-term gains to long term profitability.
The company’s pay increase for its executives and partners is the first of its kind for the firm since going public in 1999.
At the same time, Blankfein will receive a one-time stock award worth $12.6 million.
The company’s Chief Operating Officer Gary Cohn and Chief Financial Officer David Viniar also received raises, according to a Securities and Exchange Commission filing last week.
The move comes at the heels of Goldman reporting a 38 percent drop in net income for 2010. Nevertheless, the company set aside 39 percent of its revenues for compensating employees, the second-lowest percentage since 1999, according to a Wall Street Journal Report.
Goldman’s move follows that of other banks, which have recently boosted executive pay, while decreasing bonuses and increasing stock-based compensation.
Vikram Pandit, the CEO of U.S. bank Citigroup Inc., received his first raise after taking in $1 since becoming the bank’s chief and vowing to not receive additional base compensation until the bank made a profit.
Two weeks ago, after Citigroup announced its first annual profit since 2007, Pandit received a large raise to boost his base salary to $1.75 million per annum.
