Marc Benioff and other top executives' compensation plan is rejected by Salesforce shareholders.

• The board recommended compensation for Salesforce executives, but investors rejected it.
• In January, concerns were raised by shareholder advisory firms regarding a second equity award given to CEO Marc Benioff.
• The vote is nonbinding.

Shareholder advisory groups raised concerns about equity awards granted to CEO Marc Benioff, leading investors to vote against the company's compensation plan for top executives.

At the annual meeting held on Thursday, the resolution to approve the compensation received 339.3 million votes in favor and 404.8 million against, according to a regulatory filing on Monday.

Despite the board's request for shareholders to approve the resolution before the event, Glass Lewis and Institutional Shareholder Services advised investors to vote against the measure.

Benioff's total pay for the 2024 fiscal year was $39.6 million, an increase from $29.9 million in the previous year. Although his salary remained at $1.55 million, he received additional stock and option awards, as well as non-equity incentive plan compensation. The most recent sum included security fees that had not previously been billed to the company.

In January, Benioff received a second long-term equity award worth $20 million from the board's compensation committee, acknowledging the company's successful transformation actions and strong financial performance in the fiscal year.

In its recommendation, Glass Lewis expressed concern that shareholders may be hesitant to approve the substantial discretionary equity grants issued to Benioff in January, as there was a "lack of a fully convincing rationale" behind the grants.

Benioff was already one of the largest shareholders of Salesforce, with a stake of over 2% worth nearly $6 billion. Glass Lewis argued in its proxy paper that the extra performance-based restricted stock units and stock options were unnecessary because his interests were already aligned with those of shareholders.

The vote from the annual meeting is non-binding.

Our Compensation Committee, responsible for designing and administering our executive compensation program, values the opinions of our stockholders and will consider the outcome of this vote when making future executive compensation decisions, as stated in our proxy statement.

The company didn't immediately provide a comment.

In the 2024 fiscal year, Salesforce shares experienced a 67% increase, marking their strongest performance since 2011.

In the fiscal year, net income increased from $208 million to $4.1 billion, while revenue grew from $31.4 billion to $34.9 billion. In January 2023, Salesforce announced plans to lay off 10% of employees after activist investors began buying up stakes and demanding a better balance between profit and growth. Salesforce later announced in February that it would begin paying a dividend to shareholders.

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