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U.S. NEWS Saturday 26 May 2018

For CEOs, $11.7 million a year is just middle of the pack

By STAN CHOE term incentive compensa-
AP Business Writer tion until 2021.
NEW YORK (AP) — Chief CEOs MAKE HOW MUCH
executives at the biggest MORE?
public companies got an This is the first year that
8.5 percent raise last year, companies had to report
bringing the median pay the median pay for their
package for CEOs to $11.7 employees. Median is the
million. Across the S&P 500, midpoint of the pay scale.
compensation for CEOs Across the S&P 500, the
is often hundreds of times median compensation last
higher than typical workers. This photo combination shows the five highest-paid CEOs at big U.S. companies for 2017, as cal- year was $70,244, accord-
culated by The Associated Press and Equilar, an executive data firm. From left: Hock E. Tan, Broad-
The pay increase matches com, $103.2 million; Leslie Moonves, CBS, $68.4 million; W. Nicholas Howley, TransDigm, $61 mil- ing to Equilar. That's higher
the bump that CEOs re- lion; Jeffrey Bewkes, Time Warner, $49 million; and Stephen Kaufer, TripAdvisor, $43.2 million. (AP than the average pay for
ceived in 2016, according Photo) all U.S. workers, at $47,792,
to salary, stock and other because the S&P 500 is full
compensation data ana- sultants say the ratio can and 2017, at 95 percent, The second-highest paid of big, multinational com-
lyzed by Equilar for The As- give a false impression. For according to the data CEO was Leslie Moonves of panies. Last year's median
sociated Press. example, some compa- compiled by Equilar. The CBS. He made $68.4 million, pay for the U.S. is not yet
For the first time, the gov- nies exclude some of their boards of directors who set including a $20 million bo- available. Companies in
ernment required compa- lower-paid foreign workers, CEO pay, meanwhile, say nus. CBS stock fell in 2017, the pharmaceutical, tech-
nies to show in their annual which regulations allow. they are tying more of their but the company's board nology and energy sectors
proxy statements just how And companies with large executives' compensation highlighted how CBS is pro- were on the high end of
much more bosses make part-time workforces will to how the company is per- ducing more premium con- the S&P 500 for worker pay.
than the typical employee. show much greater dispar- forming, and they need to tent where it has an owner- At Facebook, for example,
The typical CEO made 164 ity between the CEO's pay pay the going rate to keep ship stake, among other the median compensa-
times the median pay of and median pay. talented executives. accomplishments. tion was $240,430. On the
their employees, accord- At Yum Brands, CEO Greg The AP's CEO compensa- No. 3 was W. Nicholas How- low end were retailers and
ing to Equilar's analysis. Creed's pay of $12.3 million tion study includes pay ley at TransDigm, which de- fast-food restaurant chains,
Because the government was 1,358 times higher than data for 339 executives at signs and produces aircraft which tend to have more
gave companies wide the company median of S&P 500 companies who components. He earned part-time workers.
leeway in how they calcu- $9,111. The employee who have served at least two $61 million, including $51.2 Coming into this year, many
lated the median pay of earned that amount, on full consecutive fiscal years million of payments from companies had big con-
their workers, and because an annualized basis, was at their respective com- the company on stock op- cerns about the reaction
some industries rely heavily a part-time employee at a panies, which filed proxy tions he holds, as if they had to their CEO-to-worker pay
on part-time workers, the Taco Bell restaurant. statements between Jan. 1 earned dividends. Howley, ratios, particularly among
CEO-to-worker pay ratios Even at United Rentals, and April 30. Some compa- a Transdigm co-founder, their own employees. But
are imperfect and make where the median pay nies with highly paid CEOs left his position as CEO last after publishing the num-
comparisons difficult. De- was $77,127 last year, it did not fit these criteria, month. He is now executive bers, the backlash wasn't
spite pushback, Congress would take a worker earn- such as Oracle, and were chairman. that big, said Melissa Burek,
forced companies to pub- ing that amount 166 years excluded. Jeffrey Bewkes of Time War- a partner at Compensation
lish the data as a way to to match the $12.8 million THE TOP FIVE ner was the fourth-highest Advisory Partners.
shine a spotlight on income in compensation that CEO The highest-paid CEO in paid CEO at $49 million. "I have clients in the Mid-
inequality. Michael Kneeland made Equilar's analysis was Hock Time Warner rejiggered west, where they're the
A debate has already en- last year. Tan of Broadcom, who its compensation formu- largest employer in town,
sued about the significance So far, shareholders seem made $103.2 million. The las for executives follow- and I would have thought
of this newly released data. OK with the pay packag- vast majority of Tan's com- ing its deal to be acquired those would get more at-
"High pay ratios send a es for CEOs. At both Yum pensation came in the by AT&T, which was an- tention," said Daniel Lad-
dispiriting message to the Brands and United Rent- form of a stock grant, val- nounced in 2016 but is still din, another partner at
workforce," said Liz Shuler, als, more than 95 percent ued at $98.3 million. He'll re- awaiting government ap- Compensation Advisory
secretary-treasurer of the of shareholders approved ceive the shares if the stock proval. Bewkes received Partners. "But no one seems
AFL-CIO, which has been their CEOs' pay for last year. hits certain performance restricted stock valued at to be getting too upset
calculating its own tally of Likely buoying that support targets over the next four $32 million. about it."
CEO-to-worker pay ratios was the 31.1 percent return years. The company said in No. 5 was TripAdvisor's Ste- All the leeway companies
for years. "Companies are for Yum Brands stock and a filing with regulators that phen Kaufer, at $43.2 mil- had in calculating their ra-
asking their workers to do the 62.8 percent rise for the figure looks substantial, lion. He received grants of tios helped many to avoid
more with less, at the same United Rentals. but the amount Tan earns options and restricted stock being an outlier, on either
that CEO pay is on the rise." Across the S&P 500, such will "only be exceptional if valued at $42.1 million, and the high end or the low
Detractors among busi- votes on executive com- our (stock returns relative to the company said it does end, said Kelly Malafis, also
ness groups, academics pensation passed with simi- other companies) is excep- not expect to give him an- a partner at Compensation
and compensation con- lar approval ratings in 2016 tional." other stock grant as long- Advisory Partners.q