The amount of money America CEOs make has been called obscene. It is often many hundred times what their employees earn. The trend has been particularly criticized at public corporations that pay people little more than the locally mandated minimum wage. This has included, in the recent past, such operations as McDonald’s, Starbucks, and Walmart. (These are the lowest-paying American companies.)
The median CEO pay at America’s largest companies jumped again in 2021. The Harvard Law School Forum On Corporate Governance reported that, across a sample of chief executive pay, based on SEC filings, the sum called “total direct compensation” reached $14.3 million. That was up from $12 million in 2020. That amount is minimal compared to the compensation paid to one American CEO, who made almost $247 million last year. That chief executive was Discovery’s David Zaslav, who racked up $246,573,481 including base pay, bonuses, stock option grants, and short-term incentives.
The groups most often criticized for such stratospheric pay levels are the corporate boards that set CEO pay. Many board members make large amounts of money themselves, particularly for the hours they put in. A director at a large company can make several hundred thousand dollars for a year’s worth of service.
Shareholders have no way to challenge these pay levels. New SEC rules (which took effect in 2011) say that large public companies must let shareholders have a “say on pay,” but the results of these votes are “advisory and not binding”. In other words, investors have no “say on pay” at all.
MyLogIQ, which examines public company documents using machine learning and artificial intelligence, recently looked at the CEO pay at large companies in the S&P 500. A number of America’s best-known companies made the list, including Goldman Sachs, Johnson & Johnson, Walt Disney, and Visa – though none of them paid their chief executives as well as Discovery.
Discovery has become much better known in recent months. AT&T recently spun off its Warner Media assets, which include Warner Bros., HBO, and CNN. These will be merged with Discovery to form a new corporation named Warner Bros. Discovery. Zaslav will be its CEO. This will make him head of one of the largest media companies in the world. (Compare this with the biggest company the year you were born.)
The CEO of the number two company on the list of highest paid chief executives is much more famous. Tim Cook of Apple made $98,734,484 last year, when the company was the third largest on the Fortune 500, based on revenue.
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