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Most of Canada’s large cannabis companies faced shareholder blowback in 2024 for the millions of dollars their chief executive officers madeafter years of stock-price declines.

Tilray Brands Inc. TLRY-T, Canopy Growth Corp. WEED-T, Aurora Cannabis Inc. ACB-T and SNDL Inc. SNDL-Q (formerly known as Sundial Growers Inc.) all had significant numbers of shareholders either oppose their executive compensation packages in advisory say-on-pay votes last year or signal their displeasure by withholding votes for directors who sit on board compensation committees. Some companies faced both actions.

In all cases, shareholders seemed to take their voting cues from proxy advisers Institutional Shareholder Services (ISS) or Glass, Lewis & Co. LLC, which made negative recommendations on the companies.

At Tilray, CEO Irwin Simon has long topped the industry in pay, even though his US$10.14-million in the year ended May 31, 2024, was down from the US$15.66-million and US$19.46-million of the two prior years. Stock awards made up less than half of his 2024 pay after providing more than half of it in 2023 and nearly all of it in 2022.

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Tilray only conducts a non-binding, advisory vote on executive compensation every other year, and 2024 was one of the off years. Lacking a referendum on pay, shareholders withheld 39.4 per cent of their votes for director David Hopkinson and 35.8 per cent for director Thomas Looney, who serve on Tilray’s compensation committee.

ISS said Tilray had an “unmitigated pay-for-performance misalignment” with “excessive” stock awards and “relatively high” salary and bonus opportunity for Mr. Simon. Glass Lewis noted that Tilray’s 2023 say-on-pay vote yielded support of just over 70 per cent, including abstentions. (The average Canadian company gets roughly 90-per-cent support, and the advisers believe less than 80 per cent means companies should engage with shareholders.)

In the absence of a say-on-pay vote, ISS and Glass Lewis suggested withholding support from the two directors.

While Tilray shares climbed nearly 8 per cent in the company’s most recent fiscal year, in the three years ended May 31, 2024, they declined 89.2 per cent, according to S&P Global Market Intelligence. The company did not respond to requests for comment for this article.

At Canopy, CEO David Klein made US$7.61-million in the year ended March 31, 2024, up from US$6.46-million the previous year. The estimated value of stock and option awards made up well over half his compensation in both years.

Canopy’s say-on-pay proposal received 79.5 per cent of all votes cast, including abstentions. Five directors had between 10.8 per cent and 12.7 per cent “against” votes, pushing their support below 90 per cent.

While ISS said it had no “significant concerns” with Canopy’s pay and recommended a “yes” vote, Glass Lewis said “no.”

The latter objected to above-target bonus payouts after years of what it called poor stock performance. (Canopy shares fell 50.8 per cent in the fiscal year, according to S&P Global Market Intelligence, and were down 97.1 per cent over three years.) Glass Lewis also disliked that Canopy decided to eliminate performance-based long-term incentives from its 2024 and 2025 pay plans. The advisory firm also recommended withholding votes from Canopy’s compensation committee chair, Theresa Yanofsky, who received fewer “for” votes than any other director, with just over 87 per cent.

In a statement, Canopy spokesperson Nik Schwenker said the company works annually with executive compensation consultants at Mercer, whom he called “reputable experts.”The strategy, he said, “is designed to attract and retain the talent necessary to advance the company’s ambitious growth plans” and has “a heavy weighting” to performance-based compensation to ensure alignment between leadership and shareholders.

Aurora CEO Miguel Martin made $8.02-million in the year ended March 31, 2024, up from $6.72-million in the previous period, which was only nine months long due to a change in the company’s fiscal year. His 2024 pay included $4.18-million in what regulators call “all other compensation” in its disclosures. That includes benefits and, for Mr. Martin, a “performance-based cash retention payment” of $812,307 and a US$2.5-million “final contractual obligation owed to Mr. Martin associated with the acquisition of Reliva, LLC in May, 2020.” (Mr. Martin had been president of Reliva when Aurora acquired it.)

Aurora’s say-on-pay proposal received 67.8-per-cent support in 2024. Five of seven Aurora directors had double-digit percentages of votes withheld, with two, Theresa Firestone and Ron Funk, at 19.82 per cent and 20.74 per cent, respectively.

ISS and Glass Lewis both recommended “no” votes on Aurora’s say on pay. ISS recommended withholding votes from both Ms. Firestone and Mr. Funk, who are compensation committee members. Glass Lewis recommended withholding votes from Ms. Firestone, the chair of the committee, for compensation issues. (They recommended withholding votes from Mr. Funk for different reasons.)

Both firms noted Aurora’s stock performance, which was down 36.9 per cent in the fiscal year, 94.9 per cent over three years and 99.6 per cent over five, according to S&P Global Market Intelligence. ISS said CEO compensation has increased “materially” in the past three years, and Glass Lewis objected to the amount.

At 67.2 per cent, Aurora’s 2024 say-on-pay support was the highest in years. It was 50.8 per cent in 2023, 57.9 per cent in 2022 and 61.9 per cent in 2021.

Aurora spokesperson Michelle Lefler said “the improved results of our annual meeting held earlier this year affirm majority support for the resolutions put forward to shareholders and their continued trust in our executive and board leadership.” She said Aurora designs its compensation programs “to align with best-in-class standards and shareholder interests” and workswith outside compensation consultants.

SNDL, which, by market capitalization, is now more valuable than Canopy and Aurora, paid CEO Zachary George $10.28-million in the year ended Dec. 31, 2023, compared with $8.16-million in 2022. Stock awards made up a sizable majority of his pay.

SNDL did not conduct a say-on-pay vote, but five of its six directors saw votes withheld in the double digits; three of them – compensation committee members Lori Ell, Frank Krasovec and Bryan Pinney – had more than 36 per cent of votes withheld.

ISS recommended that shareholders withhold the votes because SNDL’s CEO pay rose for two consecutive years despite thestock lagging peers. (The shares fell 21.5 per cent in 2023 and 65.4 per cent in the three years ended Dec. 31, 2023, according to S&P Global Market Intelligence.) Also, ISS said, the company lacks performance-based equity awards and doesn’t provideenough disclosure on how it decided on executive bonuses.

The company did not respond to requests for comment for this article.