By Justin Baer 

Morgan Stanley paid its top executive $22.5 million for his work in running the Wall Street firm in 2014, a 25% raise from a year earlier.

James Gorman, chairman and chief executive, received an annual salary of $1.5 million, a cash and stock bonus of $14.5 million and longer-term incentive pay valued at up to $6.5 million, Morgan Stanley said Wednesday in a regulatory filing.

The pay package capped Mr. Gorman's most successful--and lucrative--year in his five as CEO. The 56-year-old executive's turnaround plan gained steam, lifting profits and the firm's stock price.

Mr. Gorman had received $18 million for his 2013 performance and $9.75 million after the firm posted a 2012 loss.

The latest increase has helped narrow the pay gap with his counterpart at Morgan Stanley's longtime rival, Goldman Sachs Group Inc. Goldman's chairman and chief executive, Lloyd Blankfein, received about $24 million in salary and bonus, though any long-term incentive awards he received won't be disclosed until Goldman unveils its annual proxy statement.

James Dimon, J.P. Morgan Chase & Co.'s chairman and CEO, received $20 million.

Goldman paid Mr. Blankfein $23 million in salary and bonus for his 2013 performance, and granted him long-term awards that could bring in an additional $6 million if he hits certain targets over the next several years.

Morgan Stanley also announced in its filing the nomination of a new director, Perry M. Traquina. Mr. Traquina, 58, was chairman, CEO and managing partner of Wellington Management, an asset management firm.

Morgan Stanley's other top executives also received pay increases this past year.

Ruth Porat, who resigned as finance chief last month to take the same role at Google Inc. , received $13 million, including salary, bonus and long-term incentive pay.

Greg Fleming, who runs Morgan Stanley's wealth and asset-management businesses, and Colm Kelleher, who heads investment banking and trading, each earned a total pay package of $16 million.

Morgan Stanley's board members wrote in the filing that in setting the CEO's pay the board considered "Mr. Gorman's continued outstanding leadership of the company, including his efforts in articulating and executing a companywide strategy to enhance profitability, share price and market capitalization; maintaining sound risk management and controls; and promoting cultural cohesion and engagement among employees."

Morgan Stanley's board recommended that investors vote against a trio of proposals by their fellow shareholders: One urged Morgan Stanley to disclose its lobbying expenses annually, while another ordered a change in the way the firm counts proxy votes. The third called for preventing executives from speeding up the vesting period for stock awards should they leave the firm for a government post.

Write to Justin Baer at justin.baer@wsj.com

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