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Larry Ellison, who has been known as the highest-paid CEO in the U.S., may no longer have that distinction, as the Oracle Board voted to cut his pay by more than half; Ellison is being paid $3 million in options compared to the $7 million he has received consistently in the past few years. In 2010, Ellison lowered his salary to $1 and insisted on being paid in options. It is estimated that Ellison has made $960 million since this change in his pay structure.
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President Safra Catz also saw her pay halved, from $5 million in options to $2.5 million, but her pay has been more volatile than Ellison’s, and less resentment has been directed at her than at Ellison. Since 2008, the Oracle’s shareholders have expressed dissatisfaction with the CEO’s level of pay compared to the company’s performance. Last year, shareholders challenged Ellison’s compensation, and it had to be justified in a lengthy letter.
All it took for Ellison’s pay cut was underperformance from the company, and 2014 has seen a decline for Oracle, which missed the majority of its earnings reports, has seen revenue and sales slump and a proliferation of smaller competitors biting at Oracle’s heels, particularly in the area of cloud computing.
Ellison, listed by Forbes as the 3rd richest men in the world behind Bill Gates and Warren Buffett, won’t be in the poorhouse anytime soon, but no doubt he hopes his company won’t have to go begging for new customers.
