An analysis of proxy statements from 100 companies by consultants William Mercer found that salaries and bonuses dropped a median 2.9% to $1.24 million – a product of performance-linked bonus cutbacks brought on by the recession, according to a Wall Street Journal report.
CEOs’ median total direct compensation – salary, bonuses, stock-option gains, long-term incentives, and the value of restricted stock – also dropped 10.2% to $2.16 million.
The decreases mark the first such declines in the 12 years that The Wall Street Journal has tracked compensation of big-business executives, the Journal said.
The Mercer analysis, conducted as part of the Journal’s broader annual study of CEO pay at 350 major companies, mainly covered corporations whose fiscal year 2001 ended before December 31.
Overall pay may have declined, but the Mercer analysis revealed no evidence of damped enthusiasm for so-called megagrants of options. An option megagrant has a face value of at least eight times an individual’s salary and bonus.
About 28% – or 24 of the 85 businesses giving out options last year – handed out the more generous option packages. By comparison, 22%, or 68 of 306 companies, did so a year earlier, the Journal said.
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