Universal Music Group’s board of directors has extended the contract of chairman and CEO Sir Lucian Grainge until May 1, 2028.
"UMG is the world’s most successful music company and there are incredible opportunities ahead for a company with the right leadership and vision," said Sherry Lansing, UMG’s chairman of the board. "The UMG board is resolutely committed to converting those opportunities and maximising shareholder value for the long term.
“Only the right kind of chief executive can help achieve that goal and Lucian is just the one to do it. Through his clear vision and strong execution in building UMG into the industry leader, Lucian has also essentially created a new category of music company. This agreement is designed to drive both the sustainable success of UMG and long-term shareholder value.”
The extended and amended agreement transitions Sir Lucian Grainge from an all-cash compensation package to one that is a combination of equity and cash. It includes an equity compensation programme with a range of performance-based objectives, which are aligned with shareholders’ interests and corresponding to the major’s long-term growth strategy.
The majority of the compensation package’s economic value will be paid in UMG equity and performance-based stock options.
Sir Lucian’s annual salary under the new agreement will be reduced by more than two-thirds from his current salary - to $5 million. Subject to the achievement of performance criteria, he will be eligible for an annual bonus with a target of $10 million.
The board will put the proposal to reappoint Grainge as executive director to UMG’s general meeting.