In 2024, James Cracchiolo, Chief Executive Officer of Ameriprise Financial, earned a total compensation of $56.1 million, marking the fifth consecutive year his earnings exceeded $50 million. This figure represents a 7% increase from the previous year. Cracchiolo’s compensation package comprises a base salary, annual bonus, and realized long-term equity awards, with the latter playing a significant role in his overall earnings.

Over the past five years, Cracchiolo’s average realized compensation has been approximately $58.3 million, largely driven by the appreciation of long-term equity awards. In 2024, Ameriprise reported adjusted earnings of $3.6 billion, or $35.07 per share, an 18.6% increase over the prior year.

Cracchiolo’s compensation structure is heavily performance-based, with only 6% of his target pay allocated to his annual salary. The remaining 94% is at-risk pay, consisting of annual incentives and long-term equity awards, including stock options, restricted stock, and performance-based restricted stock awards. After Ameriprise met its financial targets, Cracchiolo earned the maximum annual incentive award of $8.5 million.

Shareholders have shown strong support for Cracchiolo’s compensation package. In the previous year, 89% of Ameriprise shareholders voted in favor of the nonbinding say-on-pay vote evaluating executive compensation policies.

Ameriprise’s Financial Performance in 2024

Ameriprise Financial experienced significant growth in 2024, with assets under management and administration reaching $1.5 trillion, a 22% increase from the previous year. This growth was driven by strong client net inflows and market appreciation. The firm’s management and financial advice fees rose by 12.5% to $2.57 billion, and net investment income increased by 15.5% to $934 million. Adjusted operating earnings for the quarter ending September 30, 2024, were $828 million, or $8.10 per share, up from $745 million, or $6.96 per share, in the same period the previous year. ([reuters.com](https://www.reuters.com/business/finance/ameriprise-financial-reports-higher-q3-profit-boosted-by-robust-fee-income-2024-10-23/?utm_source=openai))

In the fourth quarter, Ameriprise reported a 24% rise in profit, driven by higher fee income as the value of its clients’ assets increased due to a market rally. The firm’s assets under management and administration reached $1.52 trillion, a 10% increase from the previous year. Management and financial advice fees jumped 19% to $2.72 billion, while net investment income rose 0.5% to $892 million. Adjusted operating earnings grew to $947 million, or $9.36 per … for the quarter ending December 31, 2024, up from $761 million, or … the previous year. ([reuters.com](https://www.reuters.com/business/finance/ameriprise-financials-quarterly-profit-rises-market-rally-boosted-its-fee-income-2025-01-29/?utm_source=openai))

Shareholder Support and Corporate Governance

Ameriprise’s compensation policies have received strong support from shareholders. In the previous year, 89% of Ameriprise shareholders voted in favor of the nonbinding say-on-pay vote evaluating executive compensation policies. This high level of approval reflects confidence in the company’s governance and compensation practices.

The structure of Cracchiolo’s compensation aligns his interests with those of shareholders, emphasizing performance-based incentives. This approach has been effective in driving the company’s strong financial performance and shareholder value.

Implications for the Financial Services Industry

Cracchiolo’s compensation and Ameriprise’s financial performance highlight a broader trend in the financial services industry toward performance-based compensation structures. Companies are increasingly tying executive pay to company performance to align the interests of executives and shareholders. This trend is also evident in other financial institutions, where compensation packages are structured to reward executives for achieving specific financial targets.

The strong performance of Ameriprise in 2024, despite market volatility, underscores the effectiveness of its business model and strategic initiatives. The company’s focus on client assets and fee-based income has provided a stable revenue stream, contributing to its financial resilience.

For investors, the alignment of executive compensation with company performance offers a level of assurance that management is focused on enhancing shareholder value. However, it also raises questions about the sustainability of such compensation structures and their impact on long-term company performance.

1. what was James Cracchiolo’s total compensation in 2024?

In 2024, James Cracchiolo, CEO of Ameriprise Financial, earned a total compensation of $56.1 million, marking the fifth consecutive year his earnings exceeded $50 million. This figure represents a 7% increase from the previous year. Cracchiolo’s compensation package comprises a base salary, annual bonus, and realized long-term equity awards, with the latter playing a significant role in his overall earnings.

2. How does Cracchiolo’s compensation structure align with company performance?

cracchiolo’s compensation structure is heavily performance-based, with only 6% of his target pay allocated to his annual salary.The remaining 94% is at-risk pay, consisting of annual incentives and long-term equity awards, including stock options, restricted stock, and performance-based restricted stock awards. After Ameriprise met its financial targets, Cracchiolo earned the maximum annual incentive award of $8.5 million.

3. What were Ameriprise Financial’s financial highlights in 2024?

In 2024, Ameriprise Financial experienced significant growth, with assets under management and administration reaching $1.5 trillion, a 22% increase from the previous year. This growth was driven by strong client net inflows and market recognition. The firm’s management and financial advice fees rose by 12.5% to $2.57 billion, and net investment income increased by 15.5% to $934 million. adjusted operating earnings for the quarter ending September 30, 2024, were $828 million, or $8.10 per share, up from $745 million, or $6.96 per share, in the same period the previous year.

4. How did shareholders respond to Cracchiolo’s compensation package?

Shareholders have shown strong support for Cracchiolo’s compensation package.In the previous year, 89% of Ameriprise shareholders voted in favor of the nonbinding say-on-pay vote evaluating executive compensation policies. This high level of approval reflects confidence in the company’s governance and compensation practices.

5. What are the implications of Cracchiolo’s compensation and Ameriprise’s performance for the financial services industry?

Cracchiolo’s compensation and Ameriprise’s financial performance highlight a broader trend in the financial services industry toward performance-based compensation structures. Companies are increasingly tying executive pay to company performance to align the interests of executives and shareholders. This trend is also evident in other financial institutions, where compensation packages are structured to reward executives for achieving specific financial targets. The strong performance of Ameriprise in 2024, despite market volatility, underscores the effectiveness of its business model and strategic initiatives.The company’s focus on client assets and fee-based income has provided a stable revenue stream,contributing to its financial resilience. For investors, the alignment of executive compensation with company performance offers a level of assurance that management is focused on enhancing shareholder value. Though, it also raises questions about the sustainability of such compensation structures and their impact on long-term company performance.