Universal chief Sir Lucian Grainge faces the music over £80m pay

One of the most influential men in music turns out to be one of the best paid too.

Sir Lucian Grainge, the British boss of Universal Music, could land as much as £80million in a new pay deal, on top of his £4million base salary.

Having joined Universal in 1986 and run it since 2011, he is known for his close relationship with artists, with those on the label’s books including everyone from Elton John, Mick Jagger and Stevie Wonder to Taylor Swift, Justin Bieber and Ariana Grande.

But despite his success – and the praise he has been given for resurrecting the business over the past decade – shareholder advisory groups Glass Lewis and Institutional Shareholder Services (ISS) have slammed his windfall as ‘excessive’ and called for investors to push back at the annual meeting next month.

The new contract sees Grainge’s base salary sliced from £12million to £4million.

But it also includes £40million for a five-year commitment to the 90-year-old label and another £40million based on the performance of Universal’s Amsterdam-based shares.

The latter would be paid out to the music mogul in three stages: the first if the share price hits €26.50, the second if it reaches €30 and then €38.

Universal Music shares are currently €21.02 having fallen nearly 10 per cent in the year to date.

But Grainge’s pay puts him way ahead of his music contemporaries, with incoming Warner Music boss Robert Kyncl set to earn £12million in his first year on the job.

The hefty pay packets come at a time when consumers are continuing to feel the pressure, with the Bank of England just this week telling Britons they must ‘accept they’re worse off’.

Universal chairman Sherry Lansing said the board was committed to maximising shareholder value and backed Grainge’s payout.

‘Only the right kind of chief executive can help achieve that goal, and Lucian is just the one to do it,’ she said. 

Analysts at Bank of America said the deal ensured Grainge’s and shareholders’ interests were better aligned for five years, while Credit Suisse noted that although it was a generous package, leadership stability was essential.

Grainge, 63, has spent his entire career in the industry, working with stars from Amy Winehouse to the Rolling Stones.

He joined Universal in 1986 and helped launch record label Polygram, which became one of the UK’s top three music publishers in just five years.

By 2011, the Londoner, who lives in Los Angeles with his wife Caroline, had worked his way up to becoming the chairman and chief executive.

In his first year in charge, he orchestrated the rescue of beleaguered music giant EMI following its bruising period under the ownership of private equity firm Terra Firma.

Grainge was knighted in 2016 for his contributions to the music business.

And the company, which has been majority-owned by the French media giant Vivendi since 2000, floated in Amsterdam in 2021 with an estimated value of £28billion.

Yet record labels have come under greater scrutiny in recent years as streaming services like Spotify revolutionise the way music is consumed.

A damning parliamentary report in 2021 argued that there needed to be a ‘complete reset,’ calling for the competition watchdog to investigate the commercial power of major labels, which include Warner, Sony and Universal.

Will Page, a former chief economist at Spotify, gave evidence saying that between 2015 and 2019 streaming boosted label turnover by 21 per cent.

‘The recorded music business not only got bigger but also much more profitable for record labels. Artists, however, have not received proportional benefit,’ he wrote.

Last year, the Competition and Markets Authority found that the big record labels are ‘not likely to be making significant excess profits that could be shared with creators’.

Last month Universal revealed revenues soared by over a fifth in 2022 to nearly £8.7billion, with profits up 15 per cent to £1.2billion.

It is the largest music group globally, based on revenues.