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How Much Do Corporate CEOs Really Make?

There is a lot of chatter now about the outrageous salaries many public CEO’s make – especially those CEO’s that have recently seen their companies implode – so I thought I would do a little investigation into the facts.  According to a recent survey by Forbes, here is a snapshot of the compensation last year for some of our highest paid CEOs:

CEO                         Company                     Compensation

Larry Ellison                Oracle                               $193 million

Frederic Poses             Trane                                $127 million

Aubrey McClendon      Chesapeake Energy           $117 million

Angelo Mozilo             Countrywide Finance         $103 million

Howard Schultz           Starbucks                            $99 million

Nabeel Gareeb             MEMC Electronic                  $80 million

Daniel Amos               Aflac                                     $75 million

In fact, the highest paid 25 CEOs in the country all made in excess of $46 million each.  These are phenomonal numbers.  I am the CEO of a private company  – considerably smaller than any of these individuals run (though last year I am pleased to announce we were more profitable last year than several of the companies on the list of the 25 highest paid CEOs).  I founded the company, but now have investors, and those investors deserve a decent return on their money.  Accordingly I work on a reasonable base salary, and a bonus based on profitability and growth.  No profitability – no bonus.  Seems like a reasonable deal to me.

While there are certainly great companies and great CEOs on the highest paid list (and many founders that created those great companies) – many actually were at the helm of shrinking companies with little or no profit – yet they made massive amounts of money – hence the great public concern of overpaid CEOs.  Average pay exceeding forty six million dollars a year is an incredible statistic, and shareholders have every reason to be irate. I am a believer in the power and importance of the entrepreneur, and compensation based on performance. CEOs that take home tens of millions per year while driving stockholder value into the ground should be thrown out.

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