Netflix shareholders withhold support for executive pay package

June 1 (Reuters) – Netflix Inc ( NFLX.O ) shareholders on Thursday withheld their support for the company’s executive pay package, in a non-binding vote that followed a call by striking Hollywood writers to reject the proposed 2023 compensation.

The Writers Guild of America West had urged investors to vote against the compensation offered to Netflix̵[ads1]7;s top executives, arguing that such a vote would be “inappropriate” during the strike, which has entered its fifth week.

“While investors have long taken issue with Netflix’s executive pay, the compensation structure is more extreme in light of the strike,” wrote Writers Guild West President Meredith Stiehm.

The union sent a similar letter to NBCUniversal parent Comcast Corp ( CMCSA.O ), which holds its annual shareholder meeting on June 7.

Stiehm wrote that if Netflix had the resources to spend more than $166 million on executive compensation last year for its top executives, it can afford to pay $68 million a year to writers seeking better compensation.

Netflix shareholders withheld support for the 2023 executive compensation structure in a non-binding “say on pay” vote. The company said the vote count will be reported in a regulatory filing. Last year, the company’s executive pay package received support from just 27% of the shareholder votes cast.

After last year’s vote, Netflix said it was making changes, including introducing a salary cap for its co-chief executives and a performance-based bonus plan.

This year, CEO Reed Hastings will receive a $500,000 salary and $2.5 million in stock. Co-CEOs Ted Sarandos and Greg Peters will each collect an annual salary of $3 million. Sarandos will receive an additional $20 million in stock, and is eligible for a bonus of up to $17 million. Peters will collect $17.3 million in stock and a bonus of up to $14.3 million.

The union has made executive compensation for Hollywood executives an issue in negotiations. Endeavor CEO Ari Emanuel and Warner Bros Discovery CEO David Zaslav ranked among the top 10 in Equilar’s 2022 study of the largest pay packages awarded to CEOs of publicly traded companies.

The union has put pressure on media companies to lure them back to the negotiating table. Contract talks ended on May 1, after they reached an impasse over improved wages and benefits and changes to working conditions. The use of artificial intelligence is another stumbling block.

The Alliance of Motion Picture and Television Producers, which represents streamers like Netflix and the studios in negotiations, is currently in talks with the Directors Guild, whose current contract expires on June 30. Talks begin June 7 with SAG-AFTRA, which represents actors.

Reporting by Dawn Chmielewski in Los Angeles; Editing by David Gregorio and Christopher Cushing

Our standards: Thomson Reuters Trust Principles.

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