Viacom CEO Dauman's $54M Payday? Meet the Five Board Members Who Signed Off on It

In 2015, a proxy advisory firm issued a rare recommendation against re-election of the quintet of committee members because of the disconnect between pay and performance.

This story first appeared in the Feb. 12 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.

Viacom raised eyebrows in January when it revealed a raise for the entertainment industry's second-highest-paid CEO Philippe Dauman for 2015 ($54.2 million, up 22 percent from $44.3 million in 2014) even as the company's stock plunged more than 40 percent.

The news came as the company faces several challenges: an ongoing court fight over the mental capacity of 92-year-old executive chairman Sumner Redstone, a shareholder lawsuit accusing Dauman of failing in his duties and a lacerating report from activist shareholder SpringOwl Asset Management slamming Viacom — home of MTV, Comedy Central and Paramount — for underperformance.

Viacom says its board and management are "completely focused on delivering long-term value." At public companies, executive pay is recommended by the board's compensation committee, made up of independent directors. In 2015, proxy advisory firm Institutional Shareholder Services issued a rare recommendation against re-election of all five committee members because of the disconnect between pay and performance. Such a provision had little chance of passing because Redstone controls the company, but ISS head of policy development Marc Goldstein says, "The hope is the independent directors [would be] embarrassed into taking action."

ISS' major competitor, Glass Lewis, supported re-election for Viacom board members except Inside Edition host Deborah Norville because of questions about her independence as an employee of Redstone-controlled CBS.

ISS and Glass Lewis have been tightening guidelines on the number of board seats directors should hold, now recommending a maximum of five. The concern is that overbooked directors lack time to do their jobs. Viacom compensation committee chairman Frederic Salerno currently serves on five public boards and an undisclosed number of private ones. Glass Lewis chief policy officer Robert McCormick says it's hard to assess whether Salerno is overboarded: "Sometimes companies don't provide as much information about their board members' other time commitments as shareholders would want."

Viacom declined to provide THR information on Salerno's board obligations, and no members of the company's compensation committee responded to a request for comment. Viacom's proxy notes that the committee works with expert consultants and considers information on the practices of peer companies.

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Breaking Down How Much the Compensation Committee Makes

Frederic Salerno, 72

Day job: Retired vice chair and CFO, Verizon

2015 Viacom pay: $338,626

Other boards: Five

Deborah Norville, 57

Day job: Anchor, Inside Edition

2015 Viacom pay: $293,100

Other boards: None listed

Blythe McGarvie, 59

Day job: Former CEO, Leadership for International Finance

2015 Viacom pay: $342,178

Other boards: Three

William Schwartz, 82

Day job: Of counsel, Cadwalader, Wickersham & Taft

2015 Viacom pay: $316,071

Other boards: None listed

Charles Phillips, 56

Day job: CEO, Infor

2015 Viacom pay: $312,259

Other boards: None listed