[NEW YORK] Probably the most-heard complaint about big business these days, one seemingly tailored for the 99 per cent, is how much money corporate CEOs routinely pull down. Many ordinary Americans probably cheered when stockholders - that is, the people who actually own public companies - finally began to say, "Enough."
Yet despite a lot of noise from shareholders and a few victories at big names like Citigroup and Hewlett-Packard, executive pay just keeps climbing.
Yes, some corporate boards seem to be listening to shareholders, particularly on contentious issues like the seven-figure cash bonuses that helped define hyperwealth during the boom. But rewards at the top are still rich - and getting richer.
Now that 2011 proxy statements have been filed, the extent of executive pay last year has finally become clear. Median pay of the nation's 200 top-paid CEOs was US$14.5 million, according to a study conducted for The New York Times by Equilar, a compensation data firm based in Redwood City, California. The median pay raise among those CEOs was 5 per cent.
That 5 per cent raise is smaller than last year's. But it comes at a time of stubbornly high unemployment and declining wealth for many ordinary Americans.
The latest list of the most richly rewarded executives expands on a preliminary survey Equilar put together for The Times in April, before many companies had submitted final regulatory filings for 2011.
The list has many familiar names, like Lawrence Ellison of Oracle (US$77.6 million) and Leslie Moonves of CBS (US$68.4 million).
But a number of executives from smaller companies also landed near the top. Discovery Communications had about a 10th the revenue of Oracle last year but gave its CEO, David Zaslav, US$52.4 million, the sixth-largest pay package in corporate America, according to Equilar.
Because the list includes only the CEOs of public companies, it does not capture the many billions that have been earned by top hedge fund managers and private-equity dealmakers in recent years.
But even in the more narrow universe of public companies, the complete Equilar study shows that there was not one, but two executives who had nine-figure paydays last year - the first time that has ever happened, according to Aaron Boyd, Equilar's head of research.
David Simon, the top executive at the Simon Property Group, was the second-highest paid CEO last year, with US$137 million. He joined the exclusive nine-figure niche occupied by Timothy Cook, who succeeded Steve Jobs at Apple. Cook received a package valued at US$378 million.
While Apple shareholders overwhelmingly approved Mr Cook's compensation, Simon Property investors lopsidedly rejected Mr Simon's pay package at the annual meeting in May, with 73.3 per cent voting against it, according to Institutional Shareholder Services.
But such votes aren't binding. That means companies can do as they want, whatever shareholders say.
The fact that there were votes at both companies shows the new power that investors have seized.
Still, the votes against the pay packages at companies like Simon Property also underline some of the hollowness of the shareholder initiatives. Investors get a vote on pay only after the numbers have been set by corporate boards. And, because the votes are nonbinding, they carry only the sting of possible embarrassment.
Charles Elson, director of the Weinberg Center for Corporate Governance at the University of Delaware, said the sharp rise in executive pay was a result of the practice of setting CEO compensation by looking at what other companies in the same industry are doing, then adding a bit. The additions are intended to ensure that executives stay put.
But Mr Elson said that the fears of chief executives jumping ship were misplaced, while the steady rise in executive pay had damaged corporate morale, causing employees to ask, "Why should I kill myself to get a 2 per cent raise if the CEO is going to get a 20 per cent raise?" -NYT