2. How much of the money comes from salary, and how much from bonus and stock options?
A little more than a third of CEO pay comes in cash—the exact percentage fluctuates based on market conditions.
A survey by the Hay Group for The Wall Street Journal, released last month, found that 37 percent of CEO pay was in cash last year, up from 35 percent in 2013, while the percentage paid in stock and stock options dropped 4 percentage points, to 54 percent. Pensions and perks made up the rest of the CEOs' package at the 50 major companies studied.
Hay found that companies added to the stock portion of CEO packages after the 2008 financial crisis, when stock prices were low and giving execs equity was likely to make them richer in the long term. The shift toward cash now may reflect higher stock prices, according to the study.
3. How tightly is CEO pay tied to performance?
Not very tightly at all, according to a much-cited 2000 study in the Journal of Management. It found that variations in company performance account for only about 5 percent of the variation between how much companies pay their top executives. The No. 1 variable is the size of the company, accounting for 40 percent of the difference.
Last year, the CEO compensation growth of 9.1 percent trailed the S&P 500's 13.4 percent total return.
CEO compensation is not a good proxy for long-term company performance, either.
Of executives who were among America's top 25 highest-paid CEOs in any year between 1993 and 2012, 22 percent worked for financial firms that took federal bailout money, according to the left-leaning Institute for Policy Studies.