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Wall Street CEO pay vs. shareholder gains: Who won?

Mario Gabelli
Adam Jeffery | CNBC

Wall Street pay and shareholder performance don't always line up.

Executive recruitment firm Charles Skorina & Co. makes the point in a new ranking of how much the CEOs of public investment managers are paid relative to the gains for owners of their stock.

Ric Dillon, for example, earned just more than $1 million in 2014 as CEO and portfolio manager of $16.4 billion mutual fund manager Diamond Hill Investment Group. That pay put him dead last on Skorina's ranking of the top 50 best-paid investment management chief executives.

But Dillon is No. 1 when the list is reranked for five-year shareholder returns; Diamond Hill investors have earned a market-beating average of 26.39 percent. That means Dillon, based in Columbus, Ohio, earned about $40,000 per 1 percentage point of annualized shareholder return.

Gamco Investors CEO Mario Gabelli, by contrast, earned $6.29 million for every percentage point of annualized shareholder return, a much lower rate of 14.08 percent and 45th out of 50 on the Skorina ranking. At the same time, Gabelli, whose New York-based firm manages about $47 billion, was one of the best-paid public company CEOs last year at $88.5 million, landing him on top of all other public investment managers.

"It's clear that all the guys are transparent," Skorina founder Charles Skorina said about how the CEOs are paid. "But shareholder value doesn't always align with the comp."

And the top paid CEOs of 2014 are...
And the top paid CEOs of 2014 are...

A spokesman for Diamond Hill declined to comment. A spokesman for Gamco did not respond to a request.

Skorina said his intention with the ranking wasn't to pass judgment on the CEOs given numerous caveats to the ranking. That includes Gabelli and others founding their firms and owning big chunks of them—hence big pay coming from more assets under management—and the fact the CEOs often have pay tied closely to profits with negligible base salaries.

Instead, Skorina said, the list is an attempt to anticipate the results of a new reporting rule from the Dodd-Frank Act that will put executive compensation side by side with stock performance.

CEOs ranked by pay and performance

Rank Company CEO Pay for perform 2014 Comp $M 2014 AUM $B 5 yr shareholder return
1Diamond Hill CMDillon, R.0.041.0415.726.39
2WisdomTreeSteinberg, J.0.084.3839.353.19
3SEI InvestmentsWest, A.0.11.7625318.38
4Virtus Invest PartnersAylward, G.0.116.5156.759.6
5Cohen & SteersSteers, R.0.173.1253.118.58
6Fortress InvestmentNardone, R.0.172.5467.514.54
7Affiliated Mgrs GrpHealey, S.0.225.3762624.07
8Och-Ziff CMOch, D.0.251.1447.54.64
9Raymond JamesReilly, P.0.326.0166.719.06
10CBRE GroupSulentic, R.0.346.3790.618.48
11Brookfield AMFlatt, J. B.0.376.6520018.03
12Federated InvestorsDonahue, J. C.0.413.66362.99.02
13City NationalGoldsmith, R.0.415.0232.712.38
14Evercore PartnersAltman, R.0.414.851411.91
15American CapitalWilkus, M.0.4116.92240.99
16CIFC CorpVaccaro, S.0.456.121413.7
17Pzena IMPzena, R.0.462.3727.75.12
18Jones Lang LasalleDyer, C.0.519.5853.618.62
19SunTrustRogers, W.0.639.1945.5414.7
20Waddell & ReedHerrmann, H.0.637.69126.5412.11
21T Rowe PriceKennedy, J.0.828.9746.810.88
22Ameriprise FinancialCracchiolo, J.0.8724.46806.1828.19
23PNC FinancialDemchak, W.0.911.3413512.58
24Calamos AdvisorsCalamos, J., Sr.0.914.5323.54.95
25Principal FinancialZimpleman, L.0.9316.92519.318.1
26Legg MasonSullivan, J.0.9811.55709.111.77
27Franklin ResourcesJohnson, G.1.1615.9880.113.73
28U.S. BancorpDavis, R.1.1919.375516.31
29Charles SchwabBettinger, W.1.211.84258.49.87
30InvescoFlanagan, M.1.2815.62792.412.23
31Wells FargoStumpf, J.1.3221.4349616.25
32BNY MellonHassell, G.1.3411.6617008.69
33Eaton VanceFaust, T.1.4111.252968
34Lazard AMJacobs, K.1.499.991976.69
35State StreetHooley, J.1.5118.84244812.52
36MetLifeKandarian, S.1.6115.16473.79.41
37Prudential FinancialStrangfeld, J.1.6122.16117613.73
38Northern TrustWaddell, F.1.9112.449346.52
39AXA Groupde Castries, H.1.996.511545.173.27
40Janus Capital GrpWeil, R.2.018.15183.14.05
41BlackRockFink, L.2.3323.86465010.24
42JP Morgan ChaseDimon, J.3.2127.717008.62
43BlackstoneSchwarzman, S.3.5285.8930024.41
44GAMCO InvestorsGabelli, M.6.2988.5247.514.08
45Morgan StanleyGorman, J.6.6423.274033.5
46Bank of AmericaMoynihan, B.11.3415.34902.91.35
47Goldman SachsBlankfein, L.15.1237.488562.48
48OppenheimerLowenthal, A G-0.633.9525.9-6.29
49Credit SuisseDougan, B.-0.869.751377-11.38
50Stifel FinancialKruszewski, R.-1.86.9619-3.87

Source: Source: Charles Skorina & Co. "Pay for perform" ratio indicates $ millions of CEO compensation per 1 percentage point of annualized shareholder return.

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