In light of Legg Mason's recent struggles and dropping stock price, the company has slashed the pay of CEO Mark Fetting and its founder Raymond "Chip" Mason.

Fetting's compensation package was listed at $5 million a year ago when he was a senior executive vice president, but dropped to $4.7 million for the fiscal year ending March 31. He was promoted to CEO in January.

Legg Mason's compensation committee slashed Fetting's cash bonus from $3.2 million to $1.9 million, and his stock awards and options grants also lost value. His base salary was $333,333. Mason, who serves as a nonexecutive chairman, received a cash bonus of $2 million, down sharply from the $6 million a year before. His total paycheck was $8.1 million, a steep cut from $13.6 million the previous year.

Shares of Legg Mason are down 33% this year, due to underperformance of mutual funds and poor bets on subprime mortgages.

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