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Yahoo Loses Another SVP, Talent Hunter Sandy Gould, as Compensation Issues Rile Staff

When the guy in charge of bringing in great employees is heading out, you have to wonder what that means.

Michael Buckner / Getty Images

Yahoo is expected to lose yet another major executive, this time Sandy Gould, who is currently SVP of talent acquisition and development at the company. It is not clear where the well-regarded exec is headed, said sources close to the situation (are there any other kind?).

Gould was hired to much acclaim just over three years ago, after a high-profile career at Disney/ABC Television Group, Linden Labs/Second Life and RealNetworks. At Yahoo, he has been a favorite of CEO Marissa Mayer, who put him in charge of recruiting, learning and development efforts, once a big focus of hers.

It’s been touch and go for a lot of high-ranking execs like Gould at Yahoo of late, many of whom are not sure what to do in the midst of all the swirl at the Silicon Valley Internet giant. That includes a proxy fight that could — and probably will — oust the entire current board, as well as a lugubrious sales process to hawk Yahoo’s core business. Also, there’s a spinoff of its stake in China’s Alibaba Group taking place.

Oh yes, let’s not forget ongoing cost-cutting that includes a lot of layoffs. (And did we mention the juice machine was on the fritz? Just kidding, purple people — your green smoothies are safe for now!)

To keep the people Yahoo does want to keep, then, has been a dicey challenge for Mayer, which is why she faced a lot of questions about that in a recent Friday all-hands meeting called FYI.

Besides an awkward question about all the bad press — in which the overmatched PR head urged the staff to “appreciate” how hard Mayer works by giving her a hug — there were several tough queries about compensation, including annual bonuses.

Why? Well, apparently no Section 16 officers (high-ranking execs) got bonuses this year and others got paid out from the low teen percentages for SVPs, about 30 percent for VPs and about 50 percent for regular employees.

The salary and bonus issue has been made even more confusing due to Mayer’s incessant fiddling with comp, most recently via something called the “cohort method.” While not getting into specifics — except that Yahoos hate it — managers tell me they have had a hard time explaining it to employees.

Here’s an easy one though: At the FYI, there was also a question about the freezing of salaries across the board. “If salaries are frozen, and the good people have left, then why should we stay?” asked one person there.

Good question! But all this cutting has to happen and is largely due to poor performance at Yahoo, which is expected to get worse in this quarter. While the company can do some patent sales and other tricks to make it look better, more hard and substantive cuts are the only thing that will really work.

Speaking of tricks, one that Mayer has been employing to hold onto staff is increased stock comp, which means loading up key execs with more shares instead of more cash. Since Mayer arrived in 2011, stock-based compensation has risen from $204 million to $457 million.

Yes, it has doubled. This is a big deal since Yahoo revenue has not increased in that time (it was $4 billion in 2015, down from $4.4 billion in 2014). And $457 million in stock comp represents from 7 percent to 10 percent of the value of Yahoo’s core assets, backing out its stakes in China’s Alibaba Group and Yahoo Japan. Again, it is a lot.

According to sources, both CRO Lisa Utzschneider and CFO Ken Goldman just got big new stock awards and they are raining down on others, as a way to keep them on board until something happens.

What that will be for Yahoo, given all the moving parts, is anyone’s guess. But one thing for sure is that means few are focusing on what might actually pull the company out of this mess: Making great products.

Which requires great talent, which — of course — brings us back to Sandy Gould, the talent guy who is leaving.

This article originally appeared on Recode.net.