David Zaslav’s generous (and unpopular) pay package is about to change — and at least partly due to popular demand.
Amid a split of Warner Bros. Discovery, which will see the company’s TV networks and streamer Discovery+ spun off into a new, separate entity, the WBD compensation committee is revising the structure of Zaslav’s compensation.
Zaslav, the Warner Bros. Discovery president and CEO, will stay behind with the studios and HBO and Max — in other words, with the good stuff. His longtime chief financial officer Gunnar Wiedenfels will serve as CEO of the spinoff company.
The WBD compensation committee says it has redesigned Zaslav’s package to better “incentivize his critical contributions.” His pay will be far more tied to the company’s total stock return; no longer will debt reduction and cash flow cut it.
Zaslav will receive less cash and more shares, and no matter how you slice it, his pay is going down, a person with knowledge of the new deal tells The Hollywood Reporter. The new deal commenced last week with a stock option award of nearly 21 million stock options (60 percent performance-vesting stock options, 40 percent time-based stock options).
Though this decision was made by the Warner Bros. Discovery board and its compensation committee, it is very much a response to a shareholder vote taken earlier this month. WBD common stockholders overwhelmingly voted against Zaslav’s generous (to put it lightly) executive compensation package. The vote was non-binding, but it got the board’s attention.
The changes to Zaslav’s pay structure are partly “address stockholder feedback and preferences with respect to CEO compensation structure,” WBD said in its Monday 8-K filing.
Zaslav have been one of media’s highest-paid executives for many years; it stopped being funny when WBD shareholders saw their investments plummeting as Zaslav’s got rich(er).
Zaslav’s new performance metrics for bonuses — both cash and equity — are set to be a moving target. His base salary will remain $3 million, but following the split, his target annual cash bonus opportunity will be reduced to $6 million (from $24 million in 2024). He’ll be able to make 200 percent the target. Zaslav’s equity awards will have a target value of $15.5 million in year one; the target will be reduced to $7.5 million for the following years.
Some of the other details, and pretty much all of the target metrics, are still being ironed out. But suffice it to say, he’s not exactly going to the poorhouse.
Zaslav’s golden parachute has not changed in a particularly material manner; Wiedenfels’ own pay package saw minor, but unremarkable, changes.