Goldman Sachs raises CEO David Solomon’s pay 24% despite weaker profits

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Goldman Sachs paid chief executive David Solomon $31mn for 2023, up 24 per cent annually despite the Wall Street investment bank reporting its lowest profits in four years. 

Last year was the most challenging so far of Solomon’s five-year tenure leading Goldman. He faced a string of critical news articles about his leadership style, while the bank also cut thousands of jobs and suffered from a slowdown in investment banking activity. 

But the board rewarded Solomon for paring back a lossmaking push into retail banking, re-emphasising Goldman’s strategy around its core investment banking and trading business and expanding in asset and wealth management. 

The $31mn in pay for Solomon is made up of $2mn in base salary and a $29mn bonus, the bulk of which is paid in performance-based stock, according to a securities filing on Friday. His remuneration was up from $25mn in 2022, making 2023 his second-most lucrative year running Goldman behind the $35mn he earned in 2021. 

Solomon’s pay rose more than overall expenses on compensation and benefits at Goldman, which were up only 2 per cent last year. Goldman’s headcount fell by 3,200 employees in 2023 to just over 45,000 and average compensation expense per employee was up almost 10 per cent

Rivals JPMorgan Chase and Morgan Stanley also raised their chief executives’ pay for 2023. JPMorgan’s Jamie Dimon, whose bank reported record profits for 2023, saw his pay rise around 4 per cent to $36mn, while Morgan Stanley’s James Gorman, who stepped down as CEO at the start of 2024, was paid $37mn, up 17.5 per cent. Bank of America cut the pay of its top executive Brian Moynihan by 3 per cent, or $1mn, to $29mn.

Goldman took several one-off hits to profits last year — such as scaling back its once-ballyhooed consumer business — in what analysts characterised as a “kitchen sink”…