Michael W. Bayley
ROYAL CARIBBEAN CRUISESAbout Michael W. Bayley
President and CEO of the Royal Caribbean brand; Named Executive Officer (NEO) at Royal Caribbean Group (RCG) . Company performance context for 2024: Revenues $16.5B, Adjusted EBITDA $6.0B, Net Income $2.9B, Adjusted EPS $11.80, with load factor at 108% and key strategic goals (“Trifecta”) achieved ahead of schedule . RCG’s annual incentive and PSU metrics emphasize Adjusted EPS, ROIC, and select ESG goals, directly linking executive pay to performance .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Royal Caribbean (brand) | President & CEO | Not disclosed | Leads brand; accountable for brand performance within RCG’s pay-for-performance framework |
External Roles
- Not disclosed in the latest proxy for Michael W. Bayley .
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 1,046,849 | 1,082,890 | 1,120,077 |
| Stock Awards ($, grant-date fair value) | 5,000,029 | 7,000,026 | 4,999,919 |
| All Other Compensation ($) | 128,847 | 141,325 | 156,373 |
| Total Compensation ($) | 7,765,760 | 10,809,615 | 9,010,054 |
| Base Salary Decisions | 2023 ($) | 2024 ($) | % Change |
|---|---|---|---|
| Michael W. Bayley | 1,085,000 | 1,123,000 | 3.5% |
Performance Compensation
| Annual Bonus Target | 2023 (% of salary) | 2024 (% of salary) | 2024 Target ($) |
|---|---|---|---|
| Michael W. Bayley | 145% | 145% | 1,628,350 |
| 2024 Bonus Framework (Bayley) | Company-wide (%) | Brand (%) | Individual (%) |
|---|---|---|---|
| Weighting | 33.3 | 33.4 (Royal Caribbean brand) | 33.3 |
| 2024 Bonus Metrics (Company-wide) | Weighting | Target | Actual | Payout |
|---|---|---|---|---|
| Adjusted EPS | 65% | $9.60 | $11.80 | 200% |
| Composite KPIs (Net Yield, NCC ex-fuel, NPS, Safety/Env/Sec/Health, Employee engagement, Corporate responsibility) | 35% | Not disclosed | Mixed; non-financial KPIs ∼166% on average; Corporate Responsibility composite 200% | Not disclosed |
| 2024 Bonus Outcome (Bayley) | Corporate Payout % | Brand Payout % | Individual Payout % | Total Payout % | Target ($) | Paid ($) |
|---|---|---|---|---|---|---|
| Result | 181.9 | 181.7 | 140 | 168 | 1,628,350 | 2,733,685 |
| Long-Term Incentive Value (LTI) | 2023 ($) | 2024 ($) | % Change |
|---|---|---|---|
| Michael W. Bayley | 7,000,000 | 5,000,000 | (28.6%) |
| 2024 Equity Grants (Bayley) | Grant Date | Type | Target/Units (#) | Max Units (#) | Fair Value ($) | Vesting |
|---|---|---|---|---|---|---|
| Annual PSUs | 2/8/2024 | PSU | 24,806 | 49,612 (200%) | 2,999,976 | 3-year, performance years 2024/25/26 weighted 25/25/50 |
| Time-based RSUs | 2/8/2024 | RSU | 16,537 | — | 1,999,943 | 3 equal annual installments commencing 1st anniversary |
| PSU Design (2024–2026) | Metric | Weight |
|---|---|---|
| Adjusted EPS | Financial performance | 45% |
| ROIC | Capital efficiency | 45% |
| Carbon Intensity Reduction | ESG | 10% |
| PSU Payout (2012–2024 Grant Cycle) | Target Shares (#) | Final Payout (%) | Shares Earned (#) |
|---|---|---|---|
| Bayley (2022 grant; payout determined in Q1’25) | 37,594 | 136% | 51,128 |
| Shares Vested in 2024 | Shares Acquired on Vesting (#) | Shares Withheld for Taxes (#) | Value Realized ($) |
|---|---|---|---|
| Michael W. Bayley | 148,056 | 57,169 | 19,445,346 |
Equity Ownership & Alignment
| Beneficial Ownership (as of 4/1/2025) | Shares (#) | % of Outstanding |
|---|---|---|
| Michael W. Bayley | 25,542 | <1% |
| Pledged Shares | — | None pledged |
| Outstanding Equity (as of 12/31/2024) | Type | Units (#) | Market/Payout Value ($) |
|---|---|---|---|
| Unvested RSUs | Time-based RSUs | 16,537 | 3,814,921 (at $230.69) |
| Unearned PSUs (2022 grant; vested 2/11/2025) | Performance-based | 75,188 | 17,345,120 |
| Unearned PSUs (2023 grant; max reflected 300%) | Performance-based | 168,936 | 38,971,846 |
| Unearned PSUs (2024 grant; max reflected 200%) | Performance-based | 49,612 | 11,444,992 |
- Stock ownership guidelines: 3x base salary for NEOs; all NEOs currently in compliance .
- Hedging/pledging prohibited for Section 16 officers; short selling also prohibited .
- Option awards: Company does not currently grant stock options .
- Insider selling pressure signal: Significant annual vesting and tax-withholding activity (e.g., 57,169 shares withheld for Bayley in 2024) may create periodic supply but does not reflect open-market sales .
Employment Terms
| Provision | Key Term |
|---|---|
| Severance (termination w/o cause or for good reason) | 2x base salary + 2x target bonus; 2 years of medical/dental continuation; outplacement; potential one-time termination bonus up to 50% of salary after 2 years (company discretion; not applicable to Hodges Bethge) |
| Death/Disability | 2x base salary + 2x target bonus; plan benefits; accelerated vesting as described below |
| Non-compete | Two years post-termination for NEOs (one year for Holtz); non-solicit of employees, consultants, lenders, suppliers, customers |
| Change-of-control acceleration | Double trigger: time-based RSUs accelerate; PSUs earned at TCC’s best estimate with immediate vesting; no cash severance absent termination |
| Gross-ups | No tax gross-ups for perquisites or change-in-control benefits |
| Clawbacks | Covers PSU and cash bonus; Dodd-Frank/NYSE restatement recovery; additional PSU clawback for material out-of-period adjustments with alleged misconduct; 3-year lookback (Dodd-Frank) and 2-year PSU lookback |
| Vesting into Retirement | Bayley meets age/service criteria; equity continues to vest per schedule with transfer restrictions until scheduled vest dates |
| Illustrative Payments (as of 12/31/2024) | Death/Disability ($) | Termination w/o Cause or Good Reason ($) | Change-of-Control with Termination ($) |
|---|---|---|---|
| Michael W. Bayley – Total | 36,703,292 | 5,548,827 | 67,023,583 |
| Components (Bayley) | Severance: 2,246,000; Bonus Settlement: 3,256,700; Equity Settlement: 31,200,592; Benefits/Outplacement: 46,127 | Severance: 2,246,000; Bonus Settlement: 3,256,700; Benefits/Outplacement: 46,127 | Severance: 2,246,000; Bonus Settlement: 3,256,700; Equity Settlement: 61,474,756; Benefits/Outplacement: 46,127 |
Compensation Committee, Peer Group, and Say-on-Pay
- Committee composition: Talent & Compensation Committee chaired by Vagn O. Sørensen; members include John F. Brock, Amy McPherson, Maritza G. Montiel, Ann S. Moore, Donald Thompson .
- Independent consultant: Meridian Compensation Partners advises on design, peers, risk, trends; reports directly to the Committee .
- Market Comparison Group changes for 2024: Added American Airlines, Delta, United, Chipotle, Domino’s, Hyatt; removed eBay, Live Nation, Travel + Leisure; full 2024 peer list includes Booking, Caesars, Carnival, Darden, Expedia, Hilton, Hyatt, Las Vegas Sands, Marriott, McDonald’s, MGM, Norwegian, Starbucks, United, Wynn, Yum! .
- Say-on-Pay: 97% shareholder support at 2024 Annual Meeting; management engaged directly with holders of ~40% of outstanding shares .
Related Party and Risk Highlights
- Related person transactions: None in 2024 .
- Section 16 compliance: Two late Form 4s due to EDGAR administrative issues (not Bayley) .
- Governance practices: Strong stock ownership guidelines; prohibition of hedging/pledging; robust clawbacks; double-trigger equity acceleration; independent committee oversight .
Investment Implications
- Pay-for-performance alignment: Bayley’s annual bonus tied significantly to Adjusted EPS and brand operating income; PSU metrics emphasize Adjusted EPS and ROIC, with an ESG decarbonization component, aligning incentives with profitable growth and capital discipline .
- Discipline and mix: Bayley’s 2024 LTI value was reduced to $5.0M from $7.0M following Trifecta outperformance in 2023, indicating measured pay outcomes despite strong 2024 results; total reported pay decreased year-over-year amid robust company performance .
- Retention and supply signals: Bayley qualifies under Vesting-into-Retirement, which reduces forfeiture risk and supports retention; annual vesting and tax withholding (57,169 shares withheld in 2024) may create periodic share supply but are not discretionary open-market sales .
- Risk mitigants: Double-trigger change-of-control terms, no tax gross-ups, prohibition of pledging/hedging, and comprehensive clawbacks mitigate governance and alignment risks .
- Ownership alignment: Beneficial ownership is <1% and all NEOs meet stock-ownership guidelines (3x salary), reinforcing alignment while limiting pledging-related risk .