Last year was an average one for T. Rowe Price shareholders, but it was lucrative for its CEO.

The Baltimore-based investment giant substantially increased its top executive’s take-home pay after analyzing peer institutions.

Robert W. Sharps, T. Rowe’s board chairman, president and chief executive officer, received $19.4 million in compensation in 2024 — a raise of more than 50% compared to the prior year, according to the company’s proxy statement filed last week to the U.S. Securities and Exchange Commission.

Executive compensation for large corporations is not as simple as agreeing upon a salary; it is often a carefully manicured, performance-based equation that seeks to align financial incentives with company goals. In T. Rowe Price’s case, a “compensation committee” composed of independent directors of the board teamed up with a “compensation consultant,” Johnson Associates, to determine a new executive pay structure for 2024.

“The Compensation Committee reviewed our peers’ CEO compensation and determined that our CEO compensation was below peers and should be increased to reflect his contributions to the Company and his leadership through challenging markets,” T. Rowe Price wrote in its proxy statement.

A graduate of Towson University and the University of Pennsylvania’s Wharton School, Sharps has worked at T. Rowe Price since 1997. He became the company’s president in 2021 and its CEO in 2022.

Sharps and other T. Rowe Price executives saw a dip in compensation in 2023, when he earned $12.8 million. His pay increased by $6.6 million last year, an even higher figure than the company anticipated. His “target” 2024 compensation was $16.7 million, according to the proxy statement.

Annual executive compensation does not include returns on stockholdings, which in Sharps’ case includes more than 500,000 shares.

While T. Rowe Price’s stock rose in value last year, it was behind the pace of market indexes such as the S&P 500.

The CEO’s pay was 70% based upon quantitative assessments (such as T. Rowe Price’s adjusted operating margin, which was strong in 2024) and 30% on qualitative measures.

“Ultimately it’s up to the board of directors to establish the mix of incentives it thinks works best for the company,” said David Yermack, a professor at New York University’s Stern School of Business.

T. Rowe Price caps its executives’ base salaries at $350,000, and the bulk of compensation comes from stock awards and cash bonuses.

Sharps’ total pay marks the most by a T. Rowe Price CEO in at least 20 years, a review of SEC filings shows. Company spokesperson Lauren Dear declined to comment beyond the proxy statement.

Sharps’ annual compensation was higher than the most recent figures available for top executives at other large Baltimore-area corporations, such as Constellation Energy, McCormick & Co., and Under Armour.

T. Rowe Price, which generated over $7 billion revenue last year, recently relocated its 2,000 Baltimore-based employees from their longtime home in downtown Baltimore to a lavish new headquarters in Harbor Point.