Study: CEO Salary, Bonuses Leap in 2003

December 30, 2003 ( - Many in the corporate world may have been singing the blues during the economic downturn, but there wasn't much cause for complaining in the executive suite this year even though executives' total compensation was flat.

According to a new study by compensation consultant Pearl Meyer & Partners, the average pay for chief executive officers was level this year at about $11.3 million, according to a Bloomberg report

Top executives’ average salary rose as much as 5% to $1.2 million and cash bonuses jumped as much as 15% to $2.2 million, the study said. However, total CEO compensation was flat compared to 2002 because the value of granted stock options may be down as much as 10% by year’s end.

Meanwhile, CEO pay almost doubled to $11.9 million from 1996 to 2001, and dropped last year to $11.3 million after the Standard & Poor’s 500 index fell 13% the previous year, the study said.

Compensation for board members is less dependent on stock-market performance.Directors’ average annual pay rose to a range of $163,352 to $178,910 this year as companies’ stepped up controls on accounting procedures and other performance gauges after recent financial scandals.

The biggest increases came in fees and retainers for sitting on key committees, such as auditing. Those payments were up 20% to 40% to as much as $23,922.

Overall directors’ annual cash retainers and meeting fees rose up 5% to 10% to as much as $50,255, the study said. Stock grants and options rose as much as 15% to $106,720. Companies offered more restricted shares – where the stock becomes available after a vesting period – than options, the company said.

The Pearl Meyer analysis was based on a survey of 50 large companies, recently filed company proxies and work the compensation consultant has done for its own clients. It focused on the 200 largest US companies by revenue, excluding regulated industries and companies with offshore headquarters, such as Bermuda-based Tyco International.