S&P 500 CEO Pay Rebounds After Decline in 2022

Amit Batish is Senior Director of Content at Equilar, Inc. This post is based on an Equilar memorandum by Mr. Batish and Courtney Yu.

CEO compensation is a multifaceted and often scrutinized aspect of corporate governance. Public companies typically incentivize CEOs to drive corporate performance with lucrative pay packages. Meanwhile, the magnitude of the pay packages awarded to chief executives is regularly a topic of public debate, often drawing the ire of several stakeholders.

For 14 years, Equilar has partnered with the Associated Press to study CEO compensation at S&P 500 companies. The 2024 edition identifies trends in compensation awards for CEOs who served in that role at an S&P 500 company for at least two years as of fiscal year end 2023. Companies must have filed a proxy between January 1 and April 30, 2024 to be featured in this study.

CEO Pay Spikes 12.6% in 2023

The U.S. economy was notably strong in 2023, especially compared to the previous year. CEO pay is often influenced by market conditions, and in 2023, this was evident as the median total compensation* for S&P 500 chief executives rose by 12.6% to $16.3 million. This represents a significant increase from last year’s study, which reported a modest 0.9% rise.

In line with the average CEO pay package, stock awards made up approximately 70% of total compensation in 2023. The median value of stock awards jumped 10.7% to $9.4 million in 2023, largely contributing to the overall rise in total compensation.

The highest-paid CEO in this year’s study is Hock E. Tan of Broadcom, who was awarded a pay package totaling $161.8 million in 2023. Tan was the only CEO that received a nine-figure compensation package in 2023. Fair Isaac Corporation CEO William J. Lansing was second on the list, earning $66.3 million in 2023. This year’s top 10 highest-paid CEOs list can be found in the table below.

Company Name Chief Executive 2023 Total Compensation
Broadcom Inc. Hock E. Tan $161,826,161
Fair Isaac Corporation William J. Lansing $66,349,962
Apple Inc. Timothy D. Cook $63,209,845
Prologis, Inc. Hamid R. Moghadam $50,891,597
Netflix, Inc. Theodore A. Sarandos $49,834,936
Warner Bros. Discovery, Inc. David M. Zaslav $49,702,546
Booking Holdings Inc. Glenn D. Fogel $46,720,734
Adobe Inc. Shantanu Narayen $44,932,578
Roper Technologies, Inc. Laurence Neil Hunn $41,295,585
ServiceNow, Inc. William R. McDermott $37,606,244

As CEO Pay Rises, the CEO Pay Ratio Follows Suit

The median S&P 500 employee earned $81,467 in 2023, up 5.2% from 2022. As a result of CEO pay increasing at a higher rate than the median employee, the CEO Pay ratio increased from 185 in 2022 to 196 in 2023. With the ratio being a required disclosure for seven years now, its impacts on executive pay practices remain limited. Nonetheless, it will continue to be a topic of discussion among the general public.

CEO Pay for Women Outpaces Overall S&P 500

The 2024 edition of our study features 341 chief executives, of which 25 are women—this marks an increase from 20 in last year’s study. Overall, the women in this year’s study were awarded a median pay package of $17.6 million in 2023, 7.7% more than the index median. For the fifth consecutive year, Advanced Micro Devices CEO Lisa T. Su was the highest-paid woman in 2023. Su’s pay package, totaling $30.3 million, edged out General Motors CEO Mary T. Barra’s total compensation ($27.8 million) by roughly $2.5 million. The women—and their pay packages—featured in this year’s study can be found in the table below.

Company Name Chief Executive 2023 Total Compensation
Advanced Micro Devices, Inc. Lisa T. Su $30,348,281
General Motors Company Mary T. Barra $27,847,405
Citigroup Inc. Jane Nind Fraser $25,458,313
Northrop Grumman Corporation Kathy J. Warden $23,532,183
United Parcel Service, Inc. Carol B. Tome $23,390,051
General Dynamics Corporation Phebe N. Novakovic $22,582,776
Elevance Health, Inc. Gail Koziara Boudreaux $21,889,039
CVS Health Corporation Karen S. Lynch $21,615,034
Vertex Pharmaceuticals Incorporated Reshma Kewalramani $20,594,441
Duke Energy Corporation Lynn J. Good $20,215,105
Nasdaq, Inc. Adena T. Friedman $18,498,752
Ross Stores, Inc. Barbara Rentler $18,094,944
Occidental Petroleum Corporation Vicki A. Hollub $17,560,293
PG&E Corporation Patricia K. Poppe $16,961,121
Otis Worldwide Corporation Judith Fran Marks $15,924,194
The Progressive Corporation Susan Patricia Griffith $15,636,618
Arista Networks, Inc. Jayshree V. Ullal $15,561,987
Zoetis Inc. Kristin C. Peck $15,237,853
Best Buy Co., Inc. Corie S. Barry $14,443,881
Ventas, Inc. Debra A. Cafaro $13,520,625
The Hershey Company Michele G. Buck $13,084,241
Celanese Corporation Lori J. Ryerkerk $12,972,962
Regency Centers Corporation Lisa Palmer $9,269,035
CDW Corporation Christine A. Leahy $9,020,376
American Water Works Company, Inc. M. Susan Hardwick $7,720,825

Communication Services Companies Award Largest Pay Packages

The communication services industry has been home to the highest-paid S&P 500 CEOs for five consecutive years now. The CEOs leading communication services companies earned $24.4 million at the median in 2023. Coming in at second is the consumer defensive industry ($17.7 million), followed by healthcare ($17.3 million). The financial services industry features the most CEOs on this year’s list at 53. Consistent with last year’s trends, the utilities industry had the lowest median total compensation in 2023, amounting to $10.1 million.

Industry Number of CEOs Median Total Compensation
Communication Services 13 $24,399,968
Consumer Defensive 18 $17,696,889
Healthcare 46 $17,289,877
Consumer Cyclical 35 $17,216,275
Financial Services 53 $16,813,566
Energy 19 $16,750,203
Technology 46 $16,730,574
Industrials 48 $15,508,495
Basic Materials 17 $13,602,758
Real Estate 28 $12,827,996
Utilities 18 $10,059,684

Virginia Is the New Home to the Highest-Paid CEOs

After several years at the top, New York was surpassed by Indiana as the state with the largest S&P 500 CEO pay packages in 2022. In 2023, Virginia overtook Indiana to lead the list of states home to at least five S&P 500 CEOs. CEOs in Virginia received a median pay package of $21.9 million, while Michigan ranked second with $19.6 million, and New York followed with $19.5 million.

California had the highest number of S&P 500 CEOs in 2023, maintaining its count at 47 from the previous year. New York ranked second with 33, followed by Texas with 28. Illinois (26) and Massachusetts (17) rounded out the top five.

*Total compensation includes information disclosed in company proxy statements including salary, bonus, stock and options valued at grant date, above market earnings on deferred compensation, and other compensation (including benefits and perks).

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