U.S. CEOs took home less pay in 2018 for the first time in five years
- Executive pay, which has been steadily increasing since 2013, dipped for the first time in five years in 2018.
- The slight difference could be indicative of shareholder pressure on stricter CEO compensation standards based on performance.
- Overall, median executive pay is 254 times more than the median salaries paid in their companies.
The CEOs of the country’s 100 largest public companies earned slightly less in 2018, marking the first decline in five years, according to a report from Equilar.
The difference was marginal, given that the median pay for the CEOs of the largest companies by revenue dipped less than 1 percent to $15.6 million. But the slight decline could indicate the impact of the shareholder community demanding executives be paid more in accordance with performance, according to Amit Batish, content manager at Equilar.
CEO pay ratio
Overall, executives made 254 times more money than their median employees last year. The two joint CEOs of computer software company Oracle were so richly compensated that they each made 1,205 times the median worker salary in their company.
That placed Oracle chief executives Mark Hurd and Safra Catz on the top of the list, ranking No. 1 and 2 respectively, each taking home more than $108 million. That’s well above the median salary of $15.6 million last year for the CEOs of the biggest companies. For its part, Oracle generated about $40 billion in revenue, placing it in the mid-point on the list.
By comparison, Warren Buffett’s financial services company Berkshire Hathaway generated over $247 billion in revenue, making it the second-largest company by revenue after Apple. Buffett, however, took home the lowest pay out of the 100 CEOs with total compensation of about $389,000. Buffett’s pay was just seven times higher than the median worker employed at his company.
Of course, Buffett, who is the, hardly needs a considerable compensation package. In 2018, Forbes estimated Buffett’s net worth to stand at a whopping $82.5 billion.
Meanwhile, only nine women made the list, though three made it to the top 20, with Oracle’s Catz ranking second. Despite the low number, increased legislative and investor pressure to include more women in corporate boardrooms may boost the ranks of women CEOs in future years, experts say.