2. Identify the trends in CEO pay over the last three years across U.S.
S&P 100 companies.
Data Extraction - Global Disclosures (Proxy Statement and
Annual Reports).
Sample : U.S. S&P 100 companies.
Pay components:
Total Cash Compensation (TCC) = Salary + Short Term
Incentives (STI)
Total Direct Compensation (TDC) = TCC + Equity Incentives
3. S&P100 ~ 89 Companies
CEOs serving full year terms across 2010-2012 considered.
Focus Industries identified on the basis of concentration of
industry categories (Statistical Mode) out of the
categorization list of S&P100 by NYSE
STI pay-out has been considered. It is difficult to make
provisions for those companies that do not set STI Target for
their CEOs and rather base their awards on a %age of
financial metrics like Net Profit, NOI or Net Sales etc.
Combined values of time-based and performance-based
Stock Options considered for simplicity.
STI deferrals in previous years adjusted as per the NextGen
GDD methodology. (identified by blank grant type in
NextGen GDD)
3
4. 4
1283461
1350000
1300500
y = 8,520x + 1,294,281
1240000
1260000
1280000
1300000
1320000
1340000
1360000
1380000
2010 2011 2012 2013 2014
US$
Median salaries grew at the rate of 0.44% over 2010-2012
Projected Salary for 2013 and 2014 is approximately $1,328,361 and $1,336,881
respectively
Inflation rate was 1.1, 3.6 and 1.7 for 2010, 2011 and 2012 respectively* .
* http://www.tradingeconomics.com/
Year
25th
Percentile Median
75th
Percentile
2010 1066667 1283461 1533333
2011 1155000 1350000 1582789
2012 1105769 1300500 1600000
5. 5
Salary Adjustment Percentage
Individual Performance
Evaluation Score
Low in Salary Range
(15-25% below market mid-
point)
Middle of Salary Range
High in Salary Range
(15-25% above the market
mid-point)
Exceeds Expectations 6% 4% 2%
Meets Expectations 4.5% 3% 1.5%
Does Not Meet
Expectations
0% -0.8% -1%
6. Median TCC was $4,188,750 in 2010 and $4,144,270
in 2012 reflecting a negative CAGR of 0.35%.
Over 65% of TCC is at-risk component.
6
33.0 31.8 33.5
67.0 68.2 66.5
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
100.0
2010 2011 2012
Median Sal% Median STI%
7. Based on concentration of industry categories, 4 industries were chosen for analysis:
1. Banks
2. Healthcare Equipment & services
3. Industrial Conglomerates
4. Oil & Gas Exploration & Production
7
Integrated Oil
& Gas
8%
IT Consulting &
Services
7%
Industrial Conglomerates
12%
Health Care Equipment
& Services
12%
Pharmaceuticals
10%
Banks
12%
Oil & Gas Equipment &
Services
10%
Oil & Gas Exploration &
Production
12%
Diversified Financial
Services
10%
Multi-Utilities
&
Unregulated
Power
7%
8. 8
10.9 11.7 12.1
10.1
20.9 21.5
76.6
66.5 63.3
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
100.0
2010 2011 2012
Healthcare Equipment & Services
Median Sal% Median STI% Median LTI%
7.6 9.3 10.6
16.1
23.0 25.0
70.1
63.6
64.8
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
100.0
2010 2011 2012
Banks
Median Sal% Median STI% Median LTI%
11.0 12.4 12.2
35.7
21.8
31.1
53.4
67.2
57.3
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
100.0
2010 2011 2012
Industrial Conglomerates
Median Sal% Median STI% Median LTI%
8.4 8.2 9.3
16.4 18.0 13.0
75.0 72.2 75.9
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
100.0
2010 2011 2012
Oil & Gas Exploration & Production
Median Sal% Median STI% Median LTI%
