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Lucian Grainge to lead Universal for five more years

By | Published on Friday 31 March 2023

Lucian Grainge

Universal Music has extended the contract of CEO Lucian Grainge for another five years, meaning he will continue to head up the major music company until at least 1 May 2028. Unless he doesn’t.

The new “extended and amended” deal sees a change to the way Grainge is compensated, the company explained in an announcement. Rather than an “all-cash compensation package” he will now receive a combination of equity and cash, with “an equity compensation programme with a broad set of performance-based objectives aligned with shareholders’ interest and corresponding to the company’s long-term growth strategy”.

“To assure the compensation programme is aligned with shareholders’ interest, the majority of the compensation package’s economic value will be paid in UMG equity and UMG performance-based stock options”, it adds.

This may avoid further controversies like that in 2021, where Grainge’s annual pay packet topped $150 million, thanks to a bonus of $123 million. That special post-IPO pay packet – it was widely pointed out – was higher than the total monies that all songwriters earned from the sales and streams of their songs in the UK in 2019.

Indeed, the big statement goes on, Grainge’s actual salary will be reduced by more than two-thirds, to just $5 million a year. How will he survive? Well, he’ll still be eligible for “an annual bonus with a target of $10 million”, we are reassured. So, while he’ll still be earning a lot more than your average songwriter, he will probably not earn more than all of them put together again. Assuming you ignore those stock options.

“UMG is the world’s most successful music company and there are incredible opportunities ahead for a company with the right leadership and vision”, brags chair of UMG’s board Sherry Lansing. “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”, she goes on. “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”.

Grainge became CEO of Universal Music in 2010 and has overseen various big developments for the company, including the acquisition of rival major record company EMI in 2012. Currently, he is calling for an overhaul of how streaming royalties are paid out in order to be more beneficial to artists (and probably Universal too).