Only in the land of sky-high CEO pay can $10 million a year be considered just "average."
The average CEO was paid $10.2 million during 2013, a sizeable 11% increase from the prior year, according to a USA TODAY review of salary, cash bonuses, estimated value of stock and options grants and perks disclosed by 200 Standard & Poor's 500 companies that released proxies between Jan. 1 and March 27. The analysis is limited to CEOs that served all of 2013 and 2012.
The roaring stock market, though, gave CEOs an even bigger bonanza than what CEOs were awarded in 2013, including four in the USA TODAY review to break the $100 million barrier. Total realized compensation, which includes salary, cash bonuses, perks plus the value of cashed-in stock options and stock that vested, jumped a whopping 13% to break the $10 million barrier with the median compensation hitting $10.5 million.
The four CEOs in the study who brought in realized gains of more than $100 million included John Martin of Gilead Sciences at $168.9 million, followed by Howard Schultz of Starbucks at $145 million. The other $100-million men included Philippe Dauman of Viacom and James Gallogly of LyondellBasell.
The two top paid CEOs, Viacom's Dauman and Robert Iger of Walt Disney, took home total compensation packages valued at more than $30 million. On top of his $3.5 million salary, Dauman hauled in bonus of $16.9 million and stock and options awards worth $16.4 million. Viacom investors at least could say they scored, too, as Viacom delivered a 58% total return. Iger was just behind with a total compensation package worth $34.3 million. The Disney leader, widely lauded for making investments in the theme parks during the recession that are paying off now, received a bonus of $13.6 million and stock and options worth $17.3 million on top of a $2.5 million salary.
The biggest raises went to Walter Robb of Whole Foods Market at 156%. But that big raise is largely a function of coming off a small base, as Robb's pay of $3.2 million was well below average. Other big raises went to Peter Rose of Expeditors International of Washington and Rakesh Sachdev of Sigma-Aldrich, who brought in 149% and 133% higher pay respectively.
Perks like company-paid home security services and the use of the corporate jet irks some who watch CEO pay as being excessive. But the value of these perks is pretty small in the scheme of things. The median perks received by CEOs was $183,841, which is less than 2% of CEOs' median total pay in 2013. Some of the perks can be head-turning, though. Rose of Expeditors International of Washington received "all other compensation" of $8 million, which exceeded the $5.4 million he received from bonuses and his relatively modest $110,000 salary. That "other compensation" was connected with an estimated retirement bonus paid to Rose that will start in September 2014 and run through August 2015.
Investors might have a tough time complaining too much. During the year, the average total return by the companies headed by these leaders was 33%. Gains weren't just vapid stock market gains powered by speculators. Profit growth at companies in the entire S&P 500 rose 10.8% in 2013, another powerful year of earnings recovery as the last recession fades away.
—By Matt Krantz of USA Today