The 2022 proxy season is now in full swing. Over the next two months, thousands of U.S. public companies will file proxy statements highlighting trends pertaining to their governance practices, including those related to executive compensation. In this post, Equilar examines a sample of early DEF14A proxy filings from Equilar 500 companies—the 500 largest U.S. public companies by revenue—as of March 18, 2022, to offer a preview of how executive compensation was structured in 2021, as well as key trends to watch through the remainder of proxy season.

CEO Pay Appears to Bounce Back Strongly From Pandemic “Woes”

Following the onset of the COVID-19 pandemic, several companies adjusted their executive pay packages to ease the burden of the pandemic on employees. For example, many CEOs saw salary cuts, adjustments to bonus payouts, changes in long-term incentive plans (LTIPs) and more. Ultimately, many companies restored those adjustments, but median CEO pay declined from $12.2 million in 2019 to $12 million in 2020 (Figure 1).

Two years after the start of the pandemic, the early data shows that CEO pay is back on the rise. In 2021, median total direct compensation for companies included in the analysis increased to $14.3 million. This change from $12 million in 2020 would represent a near 20% increase, should the trend persist. Over the last two years, many companies elected to award their CEOs for staying on board and guiding their organizations through turbulent times, likely contributing to the increase in pay.

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