Last week, Intel shareholders voted last week against the company’s compensation for its top executives.
The result of the vote states that the investors are keeping a close eye on the performance of CEO Pat Gelsinger and the progress of his turnaround plan. Shareholders representing around 34% of the shares were the ones who voted for the package. Ones representing about 920 million shares voted to approve, and those representing 1.77 billion voted against it.
Gelsinger became the CEO of Intel in Feb. 2021 and received a compensation package of $178.59 million, according to a financial filing. It had $1 million in salary, a $1.75 million bonus, over $140 million in stock awards, and nearly $30 million in option awards.
Gelsinger stated that Intel will spend profusely to build new chip factories and that Intel will be both a contract manufacturer for other chip designers along with developing its own chips.
Gelsinger’s actual payouts depend on the performance of Intel’s stock over five years. In January, Intel said, the payout of these awards is tracking at 0% because Intel stock is trading lower than when Gelsinger took over.
“The Compensation Committee believed that having 73% of the CEO’s new-hire equity awards contingent on achieving ambitious stock price growth was in the best interest of Intel and its stockholders,” Intel said in its proxy filing.
“The Committee took the outcome of this vote seriously and was highly focused on gathering and responding to our stockholders’ feedback regarding Intel’s executive compensation programs,” Intel said in its proxy, referring to last year’s vote.
Sandra Rivera was also named in 2021 who was the general manager of the company’s data center business. Also, there were three former executives who left during 2021 and one executive who plans to leave this month, according to Intel’s filing.
“We take our stockholders’ feedback very seriously, and we are committed to engaging with them and addressing their concerns,” an Intel spokesperson said in a statement. “We have already taken specific steps to address investor questions regarding compensation, including making our overall compensation approach easier to understand, clarifying our annual performance bonus goals, clearly linking pay to performance, and increasing our disclosures and transparency.”