You’ve lost the CEO succession race. Here’s your multi-million dollar bonus

In today’s CEO Daily: Fortune‘s Claire Zillman digs into just how well retention bonuses work.

The big leadership story: Paramount wins the war for Warner Bros. Discovery.

The markets: Mixed globally; Nvidia’s losses dragged down the S&P 500 on Thursday.

Plus: All the news and watercooler chat from Fortune.

Good morning. When a chief executive succession race narrows to just a few contenders, losing doesn’t always mean losing out. I’ve noticed lately that some high-profile CEO contests have resulted in hefty compensation packages for the executives who came in second.

When Disney earlier this month selected Josh D’Amaro to succeed Bob Iger as CEO, the entertainment giant gave D’Amaro’s reported rival for the job, Dana Walden, a one-time $5.26 million stock grant, plus a recurring annual target compensation of about $27 million. And when Morgan Stanley named Ted Pick as its new CEO in 2023, it paid Pick as well as Andy Saperstein and Dan Simkowitz, reportedly dual runners-up, special bonuses valued at $20 million each. 

The big bucks reflect the big stakes of retaining top talent. A leader who has ascended to the level of CEO contender is likely a high performer with broad institutional knowledge and deep relationships, both inside and outside the firm. Such a star........

© Fortune