The sum of these compensations is taken from the company’s financial statements, but is often estimated based on the company’s attempt to value the shares that the CEO may receive. As a result, executives may earn less than the sum of these, especially if the bear market persists and the company’s stock price remains declining, but if the stock recovers, they are much higher. You can also bring back the amount.
Many of the top executives in the survey received much larger wage packages than the tops of much larger companies that are making much greater profits. For example, Apple CEO Tim Cook won his first equity award since 2011 last year, receiving a total compensation of $ 99 million and ranked 13th in the survey.
Despite rising wages, shareholders clearly believe that it is tied to business performance and vote in favor of most packages. According to an analysis of 1,444 public companies by Willis Towers Watson, a consulting firm that advises companies on executive pay programs and companies, it was the “Paion Pay” vote that gained shareholder support during the year to June 3. It was only 3%. Governance is important.
For several years, public companies have typically paid their CEO, which is the result of a rule passed by Congress aimed at helping investors assess the level of executive compensation. Had to be compared to employee compensation. Last year, CEOs earned 339 times the average wage of the company’s employees, starting 311 times in 2020, according to Equilar. Median employee wages rose 10% last year from $ 83,808 to $ 92,349.
Last year’s executive compensation surged in part as the company’s board of directors, which determines CEO compensation, wanted to reward top officers for navigating the company over a pandemic. did.
In addition, the stock market recovered in 2021 and the value of stock grants, which typically account for the largest share of CEO compensation, has increased. When stock prices are rising, boards tend to say that executives are doing a good job — and pay them more.
