Dodd-Frank Moderating CEO Pay

A study by the consulting firm Hay Group about the pay rate of CEOs says income more closely matches performance than in recent years. In conjunction with The Wall Street Journal which ran major stories on the cover of today’s edition and elsewhere, this shows a shift from 2010 “when pay and performance were not directly correlated.”

Hay Group reviewed the proxy statments of 300 public companies and found “for every additional 1% a company returened to shareholders between 2009 and 2011, the CEO was paid .6% more last year.” Reporter Scott Thurm concludes that Dodd-Frank rules allowing shareholders to make non-binding votes on chief executive compensation is one of the pressures public companies are feeling to make CEO pay appear less greedy.

The median pay of those CEOs in the study who had been at their company fore than one year rose 2.8% to $10.3 million. No mention was made of overall employee compensation being similarly increased to align with higher productivity or profits.

Original article > >

Be Sociable, Share!

Leave a Reply

Your email address will not be published. Required fields are marked *

You can add images to your comment by clicking here.