The value of Visa CEO and Chairman Al Kelly’s compensation package for the recently ended fiscal year edged down 9% to $28.1 million as he put the finishing touches on his chief executive tenure at the card network giant.
While the salary component of his compensation climbed slightly to $1.56 million for the year ending on Sept. 30, relative to the prior fiscal year, the value of his stock award dropped 16% to $14.78 million, according to the company’s proxy filing with the Securities and Exchange Commission Thursday. The pay package was still the second most lucrative for Kelly since he became CEO in 2016. He added the chairman title in 2019.
The pay decline occurred as Visa’s stock price rode a rollercoaster over the past year, and was off by about 20% for the fiscal year compared to the prior year. The stock’s move downward comes as the company faces rising competition from young fintechs and regulatory challenges in a fast-changing payments industry.
Kelly, who will become executive chairman in February, wasn’t the only one on Visa’s executive team to feel the compensation downdraft. President Ryan McInerney, who will become CEO next year; Chief Financial Officer Vasant Prabhu; and Technology President Rajat Taneja all saw their compensation decline for the fiscal year due to lower stock award values, according to the proxy filing.
Executives still landed cash incentive awards as part of their packages, despite missing a “transactions growth” goal for reasons the board noted in the filing were outside their control, namely Russia’s invasion of Ukraine and the subsequent suspension of operations in those countries.
A spokesman for the San Francisco-based company declined to elaborate on the executive compensation decrease, other than to point to the 100-page proxy for further explanation.
Kelly’s shift to the executive chairman role comes as Visa plans to consider a shareholder proposal at the Jan. 24 annual meeting calling on Visa to permanently separate the CEO and chairman roles.
The non-profit National Legal and Policy Center, which owns Visa shares, proposed the change, citing corporate consultants that said the move improves corporate governance by reducing conflicts of interest, bolstering risk management and spurring independent board insights.
While Visa is already doing exactly what the resolution proposes with its November promotion of McInerney, the board urged stockholders to vote against the proposal. A “strong” lead independent director, John Lundgren, already helps satisfy those needs and the change would limit the board’s flexibility, the directors said in the proxy filing.
“We believe that it is in the best interests of Visa and our stockholders for the Board to continue to determine the most effective leadership structure for Visa on a case-by-case basis, rather than take a rigid approach to Board leadership, as requested by the stockholder proposal,” the proxy said.
The company went on to explain that Visa’s board has sometimes separated the roles, as it will do next year, and at other times, it has opted to combine them, as it did in 2019 when it voted unanimously to add the chairman title to Kelly’s duties.