Archives for 31 May,2017

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Who Approves CEO Pay?

Approval of CEO compensation packages varies by both company revenue and ownership type, according to Chief Executive’s CEO & Senior Compensation Report 2017. Here we look at who’s in the driver’s seat when it comes to the CEO’s paycheck at private companies with revenue ranging from less than $2 million to more than $1 billion.

As the chart shows, at 54 percent of the smallest companies, the CEOs themselves determine their own compensation, with boards, partners and parent companies making the calls in other cases. For $1 billion-plus enterprises, however, boards are firmly in control, approving 90 percent of all pay packages.

Generally speaking, the survey found that the larger the company as measured by revenue, the greater the role the board plays in setting compensation. In the $2 million to $4.9 million range, the board makes the call at 46 percent of companies, while in the $50 million to $99.9 million range, the board weighs in 58 percent of the time. And for companies with $250 million to $499.9 million and $500 million to $999.9 million in revenue, the board determines CEO pay 67 percent and 79 percent of the time, respectively.

For more information please visit www.ChiefExecutive.net/compreport