Investors (and artists and managers) may be wondering where their Warner Music Group returns are, but top-level executives are mostly cashing in.
Earlier this week, Warner Music Group chairman and chief executive Lyor Cohen renewed his contract and doubled his base pay. Instead of $1.5 million annually, Cohen will rake a minimum of $3.0 million, as well as a $2.5 million target bonus and various stock option grants. That follows another lucrative renewal by chairman Edgar Bronfman, Jr., who refreshed an annual package delivering a base of $1 million, and a target bonus of $3 million.
That sounds great for the individuals involved, though it seems inconsistent with a company struggling against a rapid decline in recorded product. Pali Research analyst Richard Greenfield, a frequent critic of the major label, blamed an insular group of top-level board members for the renewal, especially given a number of Cohen gaffes. “We believe the lack of independence on the compensation committee is a clear negative for public shareholders,” Greenfield explained while referencing a 70 percent stock drop during the past year. Shares of WMG hit an unimpressive $4.95 during Thursday, below an earlier $5 Pali target.