By Theo Francis and Inti Pacheco
Median pay reached $13.4 million for chief executives of the
biggest U.S. companies in 2020, setting a fifth straight annual
record in a year when businesses and their leaders battled a global
Most S&P 500 CEOs got raises of about 5% or more as their
companies recorded annual shareholder returns of about 8%,
according to a Wall Street Journal analysis of data from
See below for the CEOs who made the most and the least, as well
as those whose companies delivered the best and worst returns for
shareholders. Go to the bottom to explore a sortable table with
compensation data on more than 400 CEOs.
Paycom Software Inc. founder Chad Richison, whose pay package
was valued at more than $200 million, was the highest-paid CEO in
the Journal's analysis. Seven CEOs were awarded compensation valued
at more than $50 million last year, compared with two in 2019 and
three in 2018.
Most of the companies led by this year's top earners aren't
typically in the pay stratosphere. Several reflect the winners of
the pandemic and its economic turmoil, including videogame maker
Activision Blizzard Inc. and biotech giant Regeneron
Most CEO compensation packages are predominantly restricted
stock or stock options, as boards continue to emphasize pay
structures intended to tie executive pay to the fortunes of
shareholders generally. As a result, as stock prices rise, pay
packages can swell beyond reported figures: General Electric Co.
CEO Larry Culp received equity grants in 2020 originally valued at
about $57 million that rose to $100 million by year's end.
GE said Mr. Culp won't receive any of his August stock grant
until 2024, and then only if performance targets are met. The first
of those targets was met in December and a second one was reached
Paycom said the company must make significant market and
operational gains for Mr. Richison to realize most of his pay, and
noted he won't be eligible for further equity grants for five
Activision Blizzard's lead independent director, Robert Morgado,
said Mr. Kotick's pay was earned over four years and reflects more
than 30 years of creating value for shareholders.
Regeneron said CEO Leonard Schleifer's pay jumped because of a
front-loaded equity grant meant to replace five years of awards,
signaling the board's confidence in his leadership, and noted he
must hold the resulting shares a further three years.
DaVita Inc., a dialysis company, also said its CEO's pay was
meant to replace five years of equity grants. The company said its
board set the equity portion of the pay package amid a major
strategic shift, and that a sharp run-up in the company's share
price increased its value before shareholders approved it.
Twenty-four S&P 500 CEOs made less than $5 million last
year, down from 28 to 33 in recent years. Twitter Inc.'s co-founder
Jack Dorsey made $1.40 -- a penny for each character in the
social-messaging platform's original 140-character limit -- and gas
pipeline owner Kinder Morgan Inc.'s Steven Kean made $1.
The lowest-paid of all, at least as far as reported compensation
goes, was Tesla Inc.'s Elon Musk, one of the world's richest
executives. He reported zero pay for 2020 -- even as he raked in
stock options worth $32 billion under his landmark 2018 pay
Twitter declined to comment. A Kinder Morgan spokeswoman said
Mr. Kean reimburses the company for the cost of his health
coverage. Tesla didn't respond to requests for comment.
All five of the companies producing the best one-year
shareholder returns reported CEO pay packages well below the
median. Eleven of the 25 best-performing companies were technology
firms -- 12 if you count Tesla, which is categorized by S&P as
an auto maker. Four top-performing companies were in healthcare.
Total shareholder return reflects change in share price plus
Generac Holdings Inc., a maker of generators, and Enphase Energy
Inc., a solar power company, didn't respond to requests for
comment. Etsy Inc., the online crafts marketplace, and casino
operator Penn National Gaming Inc. declined to comment.
The worst-performing companies of 2020 tended to be in
industries hard-hit by the pandemic, such as cruise lines and
energy companies. Fifteen of the 25 worst-performing companies were
in the energy sector. One -- Hewlett Packard Enterprises Co., with
a roughly negative 45% one-year return -- was in tech.
Norwegian Cruise Line Holdings Ltd. said Frank Del Rio received
modified prior-year awards as a result of the cruise industry's
pandemic shutdown and an earlier federal decision to rescind travel
to Cuba, as well as one-time payments tied to a new employment
agreement. It called his "annual run-rate" closer to $12.8 million,
rather than the $36.4 million reported using the calculations
required by securities rules.
Occidental Petroleum Corp. said the value Vicki Hollub can
ultimately realize was "significantly impacted" by the company's
performance in last year's pandemic-related economic downturn.
Carnival Corp. said Arnold Donald gave up 45% of his $1.5
million salary during the year and that 90% of his $13.3 million
total reported pay reflected pre-pandemic performance for prior
years. Marathon Oil Corp. declined to comment beyond its securities
filings. Energy company HollyFrontier Corp. said Michael Jennings
became CEO at the beginning of its 2020 fiscal year.
Twenty-two women ran S&P 500 companies for the full year in
2020, remaining near recent lows. Their median pay was in line with
the men, at $13.6 million versus $13.4 million.
Lockheed Martin Corp.'s Marillyn Hewson -- often among the
S&P 500 index's top-paid women -- stepped down during the year,
making $28.5 million.
Several women have recently been selected to run S&P 500
firms and didn't make the analysis, including Jane Fraser at
Citigroup Inc. and Roz Brewer at Walgreens Boots Alliance Inc.
Advanced Micro Devices Inc., General Motors Co., Northrop
Grumman Corp., Hershey Co. and General Dynamics Corp. declined to
WSJ RANKING OF FULL S&P 500
This sortable table includes compensation figures as reported by
S&P 500 companies for CEOs that served in those roles for the
full year, along with one year total shareholder returns. Swipe
left to see more data for each company.
The Wall Street Journal CEO pay analysis used data from
corporate proxy statements filed through May by companies in the
S&P 500 stock index with fiscal years ending after June 30,
2020, and collected by MyLogIQ LLC, a provider of public-company
data and analysis. Aggregate pay and shareholder-return figures
exclude companies that changed CEOs or fiscal-year end dates during
the year. Pay data reflect the value of equity awards at the time
of grant, as reported by companies in annual proxy statements or
other regulatory filings. Total returns reflect stock-price change
and dividends, calculated from the month-end closest to the
company's fiscal-year end.
Sources: MyLogIQ LLC (compensation); Institutional Shareholder
Services (shareholder return); Standard & Poor's (industry
groups); company filings (2019 pay for select companies); Labor
Dept. (median weekly wages)
Write to Theo Francis at firstname.lastname@example.org and Inti Pacheco
(END) Dow Jones Newswires
June 01, 2021 05:44 ET (09:44 GMT)
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