DUBLIN — Ryanair Holdings shareholders have approved a new remuneration package that could allow Chief Executive Michael O’Leary to earn more than €150 million, despite significant investor opposition to the plan.
The vote took place at the airline’s annual general meeting in Dublin where 60.7% of shareholders backed the revised remuneration policy.
The package is linked to O’Leary remaining with Ryanair until April 2032 and achieving demanding financial or share-price targets.
The vote gives the 65 year old executive another long-term incentive as he prepares to remain at the airline for nearly four decades after becoming CEO in 1994.
€150 Million Pay Package for Micheal O’Leary
Under the agreement, O’Leary receives an option to purchase 10 million Ryanair shares at a strike price of €26.70. The options become exercisable only if he remains with the group through April 2032 and Ryanair meets one of the specified performance conditions.
The company must either achieve more than €4 billion in annual profit after tax or see its ordinary share price exceed €42 for 28 consecutive days during the relevant period.
Ryanair (FR) recorded a record €2.26 billion post-tax profit for its latest financial year, meaning the €4 billion target would require a substantial increase in earnings.
The potential reward has been estimated at more than €150 million because the difference between the option exercise price and the targeted share value could generate a substantial gain for O’Leary if the conditions are met.
Shareholders Split Over CEO Pay
The approval came despite strong opposition from investors. About 39.3% of shareholders voted against the remuneration proposal, while 60.7% supported it, making the result considerably more divided than a routine compensation vote.
Proxy advisers Institutional Shareholder Services and Pensions & Investment Research Consultants had opposed the package, raising concerns that the structure could reward O’Leary for broader movements in airline stocks rather than Ryanair-specific performance.
The criticism also focused on the €42 share-price threshold and the provision allowing the profit target to be achieved in a single year.
Supporters, however, argue that the targets are sufficiently demanding and that achieving them would create substantial additional value for Ryanair shareholders.
O’Leary’s Ryanair Legacy is Firmly Cemented
O’Leary has led Ryanair since 1994, overseeing its transformation from a small regional airline into Europe’s largest carrier by passenger numbers.
The company’s board has argued that the incentive structure is designed to keep his interests closely aligned with those of shareholders through 2032.
The new package follows an earlier share-option arrangement that could provide O’Leary with a separate payout of up to about €100 million after Ryanair met its previous performance conditions.
His new contract also includes a comparatively modest base salary and an annual bonus capped at 50% of salary.
Ryanair’s latest shareholder vote therefore represents a clear endorsement of O’Leary’s continued leadership, but the nearly 40% opposition highlights the debate surrounding executive pay.
The decision ultimately leaves the CEO with a potentially transformative financial reward if Ryanair delivers the required performance by 2032, Irish Times flagged.
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