There will be much in the media in coming weeks about the rate of CEO pay increases. There will be the usual debate about whether CEOs earned their increases.
Table 2 lists the ten individuals who received the highest percentage increase in total remuneration from 2005 to 2006.
These ten companies represent a current market capitalisation of $20 billion. In total, these companies added more than $8 billion to the value of their shareholders’ investment over the past year. The cost to shareholders (in increased remuneration to the Managing Director or CEO) to achieve this was around $7 million, or less than 0.09% of the increase in shareholder return.
Future newsletters will include more in depth analysis of the link between performance and remuneration increases.Back to all articles