“Succession”-size problems… Last year the median pay for S&P 500 CEOs dropped for the first time in a decade, falling to $14.5M, The Wall Street Journal reported. Chief execs are mostly paid in company stock, and the S&P 500 shed nearly 20% last year (womp). By the end of 2022, two-thirds of executives got smaller pay packages than originally awarded.
New rule: Traditionally packages were revealed only when they were awarded. As of last year, the SEC started requiring reporting of compensation “actually paid” by the end of the year.
Expectation vs. reality: The change forces a direct comparison between how much executives were initially awarded and how their companies performed.
Started from the top… Some execs who were initially awarded the biggest packages saw the value of their equity plunge, while others rose through the ranks:
Wipe-out: The top-paid corporate leader, Alphabet's Sundar Pichai, was awarded a package valued at $226M, but that fell to $116M after a year of battered tech stocks.
Gains: The big bosses of Exxon and Chevron saw the value of their payouts more than double by the end of the year as oil stocks surged, pushing them from the No. 15 and No. 62 best-paid CEOs into the top 5.
When times are tough, scrutiny gets tougher… Last year, a record # of companies didn’t receive majority support from shareholders for CEO pay packages. Recently, entertainment execs’ pay has been put under a microscope as the Writers Guild of America strikes. Nearly half of Warner Bros. shareholders voted on Monday against CEO David Zaslav’s pay. At the same time, record buybacks are drawing side-eye from investors who worry they’re merely pumping execs’ bonuses.