A cyberattack against a UnitedHealth Group subsidiary, Change Healthcare, in February has already cost the company more than $1 billion. But before the attack, CEO Andrew Witty realized $25 million in compensation for 2023.
UnitedHealth Group’s CEO realized $25 million in 2023
A cybersecurity attack may cost UnitedHealth Group billions, but their CEO made $25 million before the attack.
The Minnesota Star Tribune
April 24, 2024 at 3:30PM
Andrew Witty
CEO
UnitedHealth Group
Total compensation for the year ended Dec. 31: $25,012,209
Salary: $1,500,000
Non-equity incentive plan compensation: $1,800,000
Other compensation: $233,852
Value realized on vesting shares: $21,478,357
New stock options: 37,206
Median employee pay: $66,821
CEO pay ratio: 352 to 1
Total 2023 shareholder return: 0.8%
Note: The company’s annual proxy states that the Audit and Finance Committee of UnitedHealth’s board has oversight over the company’s cybersecurity framework. The company has a director education program where cybersecurity and risk oversight are among the topics on which directors are expected to receive continuing education. And cybersecurity, sustainability and executive compensation are among the topics the company regularly discusses with its largest shareholders each year.
On the compensation side, Witty realized $25 million in 2023, mostly from previously issued restricted stock awards that vested during the year. His realized compensation increased from $23.8 million in 2022.
In 2023, Witty received a $1.8 million bonus for financial and operation goals the company achieved during the year. Seventy-five percent of the cash incentive awards is based on financial measures including revenue, operating income and cash flow goals, and 25% on a mix of Net Promoter System (NPS) and employee engagement goals.
The company was above target on two of the three financial measures but finished between the threshold mark and targeted amount for the NPS and employee engagement measures. That led to an award that paid out at 60% of Witty’s targeted annual performance bonus of $3 million.
Long-term equity awards are the biggest component of executive compensation at UnitedHealth. They include a mix of stock options, restricted stock awards and performance-based share awards. For the 2021 to 2023 performance period, the company had greater-than-targeted performance on return on equity and cumulative adjusted earnings per share measures that determine those awards. Witty’s performance shares and restricted stock that vested in 2023 was worth $21.5 million.
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