Amazon CEO Andy Jassy received a total compensation of $29.2 million in 2023, which was a 12% decrease from the $33.2 million he received in 2022. This decline was mainly due to the drop in Amazon’s share price and fewer shares vesting in 2023 compared to the previous year. Jassy’s base pay increased by 15% to $365,000 in 2023, and he realized a value of $27.8 million from shares that vested during the year. Amazon also spent $986,164 on security costs for the CEO in 2023, as per the company’s proxy statement.
The compensation figures disclosed in Amazon’s proxy statement are considered realized compensation, representing the value of compensation the executive received during the year. These figures differ from SEC-prescribed compensation calculations, which include the year-over-year change in the value of shares granted to the executive. Using the SEC’s “Compensation Actually Paid” method, Jassy’s compensation for 2023 was reported as $109.6 million, mostly due to the increase in the value of shares that haven’t vested. In 2022, his reported compensation using the same method was a negative $147.7 million, reflecting a decline in Amazon’s shares that year.
Jassy’s compensation has been a topic of scrutiny, especially since he received a one-time special stock award of nearly $212 million upon becoming CEO in 2021. This stock vests over 10 years, with the majority of it vesting between five and 10 years after Jassy assumed the CEO position. Shareholders have questioned why the vesting of Jassy’s stock-based compensation was not tied to specific goals. Institutional Shareholder Services criticized the stock award as excessive and lacking connection to objective, pre-set performance criteria.
At the Amazon shareholder meeting in 2022, less than 56% of votes cast in an advisory vote on executive pay supported the company’s compensation of named executive officers, down from 81% in the previous year. However, the approval rating increased to 68% at the following year’s meeting. Amazon defended Jassy’s compensation by stating that it is fully aligned with the long-term stock price performance of the company. Additionally, Fortune reported that many Amazon senior managers and leaders would not receive cash raises in 2023, coinciding with Jassy’s increase in base pay.
Overall, Jassy’s compensation for 2023 was $29.2 million, a decrease from the previous year mainly due to the drop in Amazon’s share price and lower number of shares vesting. The discrepancy between realized compensation and SEC-prescribed calculations highlights the complexity of assessing a CEO’s compensation accurately. Shareholder concerns regarding the lack of specific performance criteria tied to Jassy’s stock-based compensation have led to scrutiny and mixed approval ratings at Amazon’s shareholder meetings. Amazon continues to defend Jassy’s compensation as aligned with the company’s long-term stock price performance.
