Morgan Stanley's James Gorman received a $14 million compensation package for his first year as chief executive, less than the $15 million he was awarded for 2009, as the company missed profit goals.
Gorman got a $1.55 million cash bonus, his first since at least 2007, according to a Thursday proxy filing by Morgan Stanley. He also received a deferred cash bonus of $2.33 million that can be clawed back, in addition to his salary, stock, option awards and other compensation. About $1.94 million of his $5.82 million in stock compensation is tied to company performance measures.
The package trailed the $23.6 million that JPMorgan Chase & Co. awarded CEO Jamie Dimon and the $19.1 million that Goldman Sachs Group Inc. granted CEO Lloyd Blankfein. Morgan Stanley's stock fell 8.1% last year, but the company posted a $4.7 billion annual profit, the most since 2006.
"We were mindful of the environment and the fact that we did not meet all of our financial performance priorities for the year," Gorman wrote in a letter to shareholders. "That is why my own compensation as CEO was down."
Morgan Stanley said measures that missed goals included return on equity, which was 9% for 2010. Morgan Stanley also increased the portion of employees' yearend compensation that's deferred and subject to clawbacks, he wrote.
In January, Morgan Stanley said that members of the operating committee would get an average of 80% of their yearend pay in deferred compensation in an effort to link bonuses with long-term performance, up from 75% for 2009. For all employees, the deferred portion rose to 60% from 40% a year earlier.
After facing "challenging market conditions amidst the regulatory and market uncertainty" in 2010, there's evidence of a global economic recovery as the U.S. unemployment rate declines, Gorman said in a separate letter Thursday.
"We have also seen signs of improving corporate confidence reflected in M&A activity, higher investor engagement and ongoing growth in emerging markets," Gorman wrote. Morgan Stanley is "particularly focused" on building its operations in China, Brazil and India, he wrote.
Gorman received a lower stock award and less deferred cash than last year, and was awarded a cash bonus and $3.5 million in options after receiving neither last year.
Gorman, who was co-president of Morgan Stanley before taking the top job, declined a bonus in 2008, when Morgan Stanley converted to a bank holding company and accepted a $10 billion government bailout. The company repaid the taxpayer funds in June 2009.
Chairman John Mack was not listed among the named executive officers.
He received restricted shares valued at $2 million, according to a January filing. He declined a bonus for 2007, 2008 and 2009, his final years as CEO.
Ruth Pora, the chief financial officer, received $11.5 million in total compensation for 2010. Walid Chammah, the chairman of Morgan Stanley International, received $10.6 million in total compensation. Greg Fleming, who is head of asset management and oversees the retail brokerage, got a $10 million package.
Morgan Stanley also asked shareholders to set aside 35 million shares to cover 2011 compensation amid calls from regulators that stock make up a greater proportion of pay.
