Investing

24/7 Wall St./MyLogIQ CEO Pay For S&P 500

Public corporation CEO compensation has been considered excessive in the United States for decades. What these CEOs make is easy to determine, because publicly traded companies are required to disclose the information. Among the groups that have complained most loudly are those who believe CEOs make little contribution to American society. Why should a CEO make hundreds of times more than school teachers, firemen, or nurses? Yet another group which often objects is shareholders, particularly when CEOs are paid well in a year when earnings or stock prices have performed poorly.

Despite these and other objections, CEO pay has risen steadily for years. Using data for the S&P 500 companies that file on a calendar year, and provided by MyLogIQ, CEO pay rose about $1 million on average in 2021 compared to the previous year. Last year the figure hit $18.5 million. These numbers include base salary, bonuses, stock compensation, and other payments companies are required to disclose to the SEC. The highest paid CEO last year was Peter Kern, who ran Expedia Group, an online shopping and travel website. His 2021 compensation was $296,247,749.

Another means by which CEO pay is measured is compared to the median compensation of each company’s employees. The rule, put into effect in 2015 by the SEC, was part of the Dodd Frank legislation. The data began to be filed in 2018. Many of these numbers have been staggering, as they were again last year. CEO to median employee pay among the S&P 500 was 317 to 1. These figures include employees both inside and outside the U.S. 

The CEO to median employee ratio is often highest among companies where workers are paid very little. One example is Yum Brands, which owns KFC, Taco Bell, and Pizza Hut. Its CEO David Gibbs made $27,578, 569, which was 2,108 times more than the median pay of his workers. Starbucks is another example. CEO Kevin Johnson made $20,425,164 which is 1,579 times more than the median pay of his employees. (He was recently pushed out in favor of former CEO Howard D. Schultz. Schultz will be paid $1 a year.) Yet another example is Chipotle Mexican Grill. CEO Brian Niccol made $17,880,580, which is 1,131 times more than the median pay of his workers. The highest pay ratio was at Aptiv where CEO Kevin Clark made $14,744,780, which is 1,992 more than the company’s median employee comp. 

Not all CEOs make huge amounts of money. Last year, Warren Buffett, one of the longest serving CEOs in America, made only $373,204. Buffet is one of America’s richest people, with a net income of $102 billion, according to the Forbes 400. Most of this money comes from his ownership in the company he runs.

Data was provided by MyLogIQ which screens public data on corporations using artificial intelligence and machine learning. It screened 446 entries for 2021. Eight of the companies have two CEOs, so total public companies reporting were 438. Companies that close their years on the last day of December must have proxies filed by April 30. Subscriptions available from MyLogIQ to compensation analysis of all US traded companies.

Correction: A previous version of this article incorrectly listed Jonathan B. Nelson as the CEO of Omnicom Group. Nelson is the CEO of Digital. John D. Wren is the CEO of Omnicom Group. This error has been corrected. 

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