Diversity, CEO pay take center stage at Microsoft’s annual meeting

December 3, 2014, 8:49 PM UTC
Microsoft Holds Annual Shareholder Meeting
BELLEVUE, WA - DECEMBER 3: Microsoft CEO Satya Nadella addresses shareholders during Microsoft Shareholders Meeting December 3, 2014 in Bellevue, Washington. The meeting was the first for Nadella as CEO. (Photo by Stephen Brashear/Getty Images)
Photograph by Stephen Brashear — Getty Images

Microsoft’s annual shareholders meeting Wednesday reflected a changed company: for the first time in years, neither Bill Gates nor Steve Ballmer graced the stage.

But Ballmer, who retired as CEO in February but is still the company’s biggest individual shareholder, certainly grabbed the limelight, appearing alongside civil rights activist Jesse Jackson in the second row of the Meydenbauer Center in Bellevue, Wash.

The famously loud former executive, who had several clashes with the board in his 14 years as CEO, and left his job under pressure from activist shareholders, did not ask any questions at the meeting. He stepped down from Microsoft’s board in August to focus on his $2 billion purchase of the NBA’s Los Angeles Clippers.

Prior to the shareholder voting, Jesse Jackson took the stage to address shareholders about the need for ongoing diversity initiatives: the tech industry “does not look like America,” he said, and asked the company to step up its efforts to create a more diverse workforce.

While Microsoft has diverse representation at its highest ranks, including an African-American board chairman, an Indian CEO and a female CFO, the overall statistics are less flattering: the company is 61% white and 71% male.

Microsoft’s new CEO Satya Nadella said the company will release its diversity data to the federal government by the end of the month. The company will publicize its EEO-1 form, which outlines employment data by race and gender according to job type. The form is standard and companies have been reporting the information to federal authorities for decades.

Intel (INTC), Google (GOOG), Facebook (FB), Yahoo (YHOO) and LinkedIn (LKND) have all publicly released their EEO-1 forms, but other tech companies have refused to date, including Apple (AAPL) and Amazon (AMZN).

The event opened with a presentation by Chairman John Thompson, and Nadella took the stage shortly thereafter, representing the two new faces of the software maker. Nadella highlighted the company’s future growth opportunities like Microsoft Azure and cloud services, which have grown significantly this year.

The annual event addressed another key topic business: Nadella’s pay.

Nadella’s nearly $84 million pay package, which Institutional Shareholder Services recommended investors vote down, was approved by a “majority” of votes, the company said.

ISS had opposed the package, saying that the $65 million stock grant was excessive. Microsoft (MSFT) has yet to release final numbers on the approval. Last year, the CEO pay package was accepted by 95% of shareholders, excluding abstentions.

Shareholders have been generally ecstatic this year as Microsoft’s market value shot up almost $100 billion since Nadella took over from Ballmer in February. That is partly due to the strong rise in stocks indexes, but also helped by Nadella soothing restless investors with a string of bold moves designed to haul the software behemoth into the mobile, cloud-computing era.

“It was a clear difference from years past as Nadella and Microsoft are more comfortable in their market positioning, growth, and strategy, given the success they have had in 2014 versus the dark days of the Ballmer era,” said Daniel Ives, an analyst at FBR Capital Markets who watched the meeting via webcast.

—Reuters contributed to this article.