Helming the leading athletic footwear company pays serious dividends. The proof can be found in Nike Inc.’s latest move to compensate Mark Parker, its CEO of nine years.
The company has granted Parker restricted stock with a target of $30 million due to Nike’s “strong performance under his leadership” and as incentive for the CEO to stay for at least the next five years, according a proxy filing.
The $30 million award represents 277,727 shares of Nike Class B Stock and will not be earned unless Parker remains employed with Nike through a five-year vesting period that ends on June 30, 2020.
The filing noted that 60 percent of the award’s maximum value is based on the company’s performance, while the other 40 percent is subject only to time vesting and will be earned if Parker remains employed with the company through June 30, 2020.
“The committee views the award as a long-term retention incentive for compensation over the five-year vesting and performance periods and not solely as compensation for fiscal 2016,” the filing states.
In announcing his succession strategy, on June 30, 2015, Nike founder Phil Knight had recommended that Parker replace him as chairman of Nike’s board. Knight, who has been at Nike for 50-plus years, dubbed Parker “the best choice” for the position.
Matt Powell, sports-industry analyst with NPD Group, said the company’s performance under Parker’s leadership might warrant the huge payday.
“Parker has done a great job at Nike,” said Powell. “The company and the stock price have thrived under his tenure.”
Nike’s share price has been steadily climbing over the last 12 months, hitting a 52-week high of $113.57 on July 20.