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Morgan Stanley’s James P. Gorman has been awarded $37 million — near the top of the $20 million to $40 million range set the by bank’s board of directors — for his performance as chief executive of the storied investment bank in 2023, according to a filing.
Morgan Stanley’s
MS,
compensation committee said the pay of roughly $3 million per month reflects Gorman’s “outstanding performance, including his exemplary execution of CEO succession and the transition of leadership,” according to the Friday filing.
The board also cited Gorman’s role in resolving legal and regulatory matters.
Also read: Morgan Stanley hit with $249 million fine for block-trading fraud
Gorman became executive chair of Morgan Stanley on Jan. 1, after 14 years as chief executive. Insider Ted Pick is now the bank’s chief executive, while two other internal contenders for the job, Andy Saperstein and Dan Simkowitz, have remained at the firm as co-presidents.
Morgan Stanley’s stock rose 0.5% on Monday. It has fallen by 11.7% in the past year, compared with a 20.7% rise by the S&P 500
SPX.
“Over his 14-year tenure as CEO and during 2023, Mr. Gorman reshaped the firm into a stronger and more balanced institution positioned for long-term growth,” the board said. “As a result, the firm’s business model performed as intended in a challenging market and macro environment in 2023.”
A year ago, the board set a target salary range for Gorman of $20 million or less for performance below expectations, and up to $40 million for performance that exceeds expectations. He earned $31.5 million in 2022 and $35 million in 2021.
Other milestones cited by the board for Gorman in 2023 included a 14% shareholder return.
More than 60% of Morgan Stanley’s pretax profit was from its wealth-management unit, up from 30% in 2010 when Gorman became chief executive, the filing said.
Morgan Stanley also cited the bank’s 12.8% return on tangible common equity “against a mixed backdrop and a number of headwinds.”
The board also approved a $1.5 million base salary for Pick as chief executive in order to bring his base salary in line with Gorman’s base while he was chief executive.
Also read: Jamie Dimon gets $1.5M raise and heaps of praise after JPMorgan Chase’s record profit
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