Early Data for 2013 shows rise in CEO compensation

By now, you’ve heard all about Pay for Performance – executives’ bonuses are not predetermined anymore but instead based on the performance of the company in both the long and short-term. But by and large, shareholders have supported executives and paid them accordingly.

Here are some key statistics that show data in 2013 compared to 2012 (data from http://www.capartners.com):

  • Shareholder support at 97%, up from 95%
  • Median CEO bonus 100% of target in 2013 compared to 97% in 2012
  • 51% of executives rewarded with more than 100% of target bonus (meaning they exceeded target), compared to 47% in 2012
  • 49% of bonuses related to long-term incentives, up from 45%
  • 50% of companies modified the peer group
  • So what does the data tell us? It seems pretty evident that executive pay is rising, predominantly through meeting targets. Executive pay is also increasingly tied to the long-term success of the company, with executives rewarded for meeting long-term goals (usually over a three year period).


    5 Major Executive Comp Trends for 2013

    Pay for Performance…

    …Most companies now use pay-for-performance looking at an executive’s performance over a three year period.

    Say on Pay…

    …Shareholders overwhelmingly support say on pay.

    Annual Incentives…

    …These appear down slightly versus 2012, with new financial and non-financial metrics used to measure performance.

    Long-Term Incentives…

    … Restricted Stock Units, Stock Appreciation Rights and performance awards continue to dominate executive incentive pay.

    2013 Merit Increase Budget…

    …Incremental growth continues consistent with previous years.