Microsoft CEO annual pay to fall

September 30, 2009 02:23:52 PM

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Microsoft chief executive Steve Ballmer's annual pay will be just shy of two million dollars, leaving him "underpaid," the US software giant reported Tuesday in a regulatory filing.

"Mr. Ballmer focuses on building our long-term success, and, as a significant shareholder, his personal wealth is tied directly to Microsoft's value," the firm said in proxy paperwork filed with the US Securities and Exchange Commission.

"While the Compensation Committee believes Mr. Ballmer is underpaid for his role and performance, it has accepted his recommendation to continue with Microsoft's historical practice."

That practice was said to exclude any long-term equity compensation as part of his annual pay.

Ballmer's pay is based on an average of executive compensation as revealed in regulatory filings of "peer companies" as of late August, according to Microsoft.

That average of 1.4 million dollars excluded salaries of the founders of Dell, Oracle and Apple, the filing indicated.

Apple chief Steve Jobs is famous for setting his annual pay at one dollar and letting his fortune ride with the fate of the company he co-created.

Ballmer's "maximum pay opportunity" for this year is 1,997,499 dollars and combines base pay with an incentive plan, according to the Washington State-based firm.

This maximum pay figure for Ballmer, who reportedly owns nearly five percent of the publicly traded company, will be frozen at the same level for fiscal year 2010, according to Microsoft.