| MARCH 30, 2010
CEOs See Pay Fall
Total Compensation Slipped 0.9% in 2009, Survey
Shows, as Recession Took Toll
The boss took another haircut as CEO
compensation edged lower in 2009, the first time in two decades that pay
declined for two consecutive years.
The median value of
salaries, bonuses, long-term incentives, and grants of stock and stock
options for the chief executives of 200 major U.S. companies declined 0.9%
to $6.95 million, according to an analysis for The Wall Street Journal by
the Hay Group management consultancy.
The drop in total direct compensation was
only the third since 1989, when the Journal began tracking CEO pay. In 2008,
pay fell 3.4%. The analysis also showed that highly paid CEOs generally run
companies that deliver better-than-average shareholder returns.
Charles Ergen, CEO and founder of
Dish Network Corp., earned the distinction of having the harshest drop
in pay. He drew a $623,100 salary that was 92.5% lower than his 2008 total
compensation, even though the company's stock doubled.
Jeffrey R. Immelt, chief executive of
General Electric Co., declined a bonus for the second straight year,
pushing his total pay lower by 4.7% to $5.1 million. GE's stock fell 6.6%
In contrast, Ray R. Irani, CEO of
Occidental Petroleum Corp., collected $52.2 million, making him the
highest paid executive surveyed. Mr. Irani has been among the Journal's best
paid every year since 2004. The company's stock rose 36% last year.
This year's overall decline reflected the
recession, government controls and continued public outcry over big pay
packages. Long-term incentive awards, mostly stock and stock options, were
hardest hit, falling 4.6% to a median $5 million. Median means half the CEOs
made more and half made less. Salaries and bonuses rose 3.2% to $2.64
As the recession deepened in late 2008, "many
boards lowered targets for 2009—and so some CEOs collected bonuses even as
profits declined,'' said Irv Becker, head of Hay's U.S.
Pay curbs appear to be ending. Several
companies recently thawed frozen salaries or canceled pay cuts.
Pfizer Inc. in February lifted a pay freeze that hit Chief Executive
Jeffrey Kindler, lifting his pay to $1.8 million from $1.6 million.
Joann S. Lublin at
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