CEOs rolling in money and stock options
The average pay packet of a CEO at a US company has risen to a staggering $9.6 million a year.
In a sign that the rich truly are getting richer - the bumper bank-boosting figure is 6 per cent higher than last year’s average, according to data from executive pay research firm Equilar of the Standard & Poor’s top 500.
Your typical American worker, on the other hand, on a median average of $39,300 per annum, would have to work away for up to 244 years to make that much money.
Top dog is believed to be the handsomely rewarded Apple CEO Tim Cook, whose pay package was valued at an unbelievable $378 million when he became the iPad maker’s supremo in August - though that was almost entirely made up of stock awards.
That’s become an increasingly common trend as firm’s trim cash bonuses but hand out more in stock - which is often tied to company performance and is intended to motivate CEOs to make sure the organisation does well.
The typical CEO got average stock awards worth $3.6 million in 2011, up 11 per cent from the year before – but cash bonuses did fall 7 per cent, to $2 million.
For many ordinary workers and shareholders though, the fact that the gap between those at the top and the rest shows no sign of changing - and will likely increase - is a massive worry.
“It’s just that total (compensation) is going up - and that’s where the problem lies,” said Charles Elson, who is
director of the Weinberg Centre for Corporate Governance at the University of Delaware.
For too long, activists say, CEOs have been richly rewarded no matter how a company has fared - “pay for pulse,” as some critics call it.
However, there are some signs well-heeled CEOs are actually being made to work their socks off for their pocket-laden packages. Booz & Company’s 12th annual CEO study has revealed top dog turnover at the world’s largest 2,500 public companies has returned to rates seen during the pre-recession years.
In 2011, 14.2 per cent of CEOs at the world’s largest companies were replaced - sharply higher than the 11.6 per cent in the crisis year of 2010.