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Howard Schultz, CEO of Starbucks.
Glassdoor recently set out to find the average ratio of CEO pay to median worker pay at some of the biggest companies in the US.
To do that, the team first sifted through 2014 Fortune 500 SEC filings to find out how much the CEO at each company earned in a year. (Some of these CEOs have since left the company or role.)
They then found the median employee compensation for workers at each company, and did some simple math to calculate the average ratio. (To ensure statistical reliability, Glassdoor only included companies with at least 30 salary reports from employees.)
They found that across all Fortune 500 companies, the average CEO pay was $13.8 million a year, while the average median worker pay was about $77,800 and the average ratio of CEO pay to median worker pay was 204.
In other words, the average CEO earns around 204 times what their median worker earns, explains Andrew Chamberlain, Glassdoor’s chief economist, in a blog post.
“Executive pay has long been controversial,” writes Chamberlain. “In recent years, a number of studies have highlighted the gap between CEO pay and average salaries for workers.” However, new rules adopted by the Securities and Exchange Commission (SEC) this month “mean all that is about to change,” he explains.
“Beginning in 2017, public companies will be required to disclose the ratio of CEO pay to median worker pay, providing transparency into pay inside some of the largest companies — all the way up to the top.”
In the meantime, CEOs of companies like Walmart and Chipotle are earning about 1,133 and 1,522 times what their employees make, respectively, according to Glassdoor research.
Chamberlain says it’s important to note that CEO compensation is highly volatile from year to year. “Most CEO pay at large companies is made up of bonuses and stock compensation that swing sharply from year to year. Choosing different base years for our analysis would have a large effect on the rankings of CEO to worker pay for these employers,” he explained in his post.
He also says to make a fair comparison, Glassdoor compared total CEO pay to total worker pay. “However, while CEO pay for bonuses, stock options, and other pay beyond base salary is accurately reported in SEC filings, most workers underreport bonuses and stock options in surveys, such as Glassdoor’s salary survey. Most workers simply don’t know or don’t recall the details of non-salary compensation. As a result, total pay is likely underreported for workers, which could overstate CEO pay ratios.”
Here are 26 CEOs who made at least 500 times what their median employee earned in 2014, in order from largest pay ratio to smallest:
David M. Zaslav
Company: Discovery Communications
Median full-time total worker compensation (2009-2015): $80,000
2014 total CEO compensation: $156,077,912
Ratio of CEO pay to median worker pay: 1,951
Steve Ells*
Company: Chipotle
Median full-time total worker compensation (2009-2015): $19,000
2014 total CEO compensation: $28,924,270
Ratio of CEO pay to median worker pay: 1,522
*Ells is co-CEO of Chipotle.
Larry J. Merlo
Company: CVS Health
Median full-time total worker compensation (2009-2015): $27,139
2014 total CEO compensation: $32,350,733
Ratio of CEO pay to median worker pay: 1,192
C. Douglas McMillon
Company: Walmart
Median full-time total worker compensation (2009-2015): $22,591
2014 total CEO compensation: $25,592,938
Ratio of CEO pay to median worker pay: 1,133
Brian C. Cornell
Company: Target
Median full-time total worker compensation (2009-2015): $30,000
2014 total CEO compensation: $28,164,024
Ratio of CEO pay to median worker pay: 939
Leslie Moonves
Company: CBS Corporation
Median full-time total worker compensation (2009-2015): $66,365
2014 total CEO compensation: $57,175,645
Ratio of CEO pay to median worker pay: 862
Steven H. Temares
Company: Bed Bath & Beyond
Median full-time total worker compensation (2009-2015): $26,047
2014 total CEO compensation: $19,116,040
Ratio of CEO pay to median worker pay: 734
Terry J. Lundgren
Company: Macy’s
Median full-time total worker compensation (2009-2015): $22,800
2014 total CEO compensation: $16,497,220
Ratio of CEO pay to median worker pay: 724
Glenn Murphy*
Company: Gap
Median full-time total worker compensation (2009-2015): $22,800
2014 total CEO compensation: $16,064,312
Ratio of CEO pay to median worker pay: 705
*Murphy is no longer CEO of Gap.
Howard D. Schultz
Company: Starbucks
Median full-time total worker compensation (2009-2015): $32,080
2014 total CEO compensation: $21,466,454
Ratio of CEO pay to median worker pay: 669
Rodney McMullen
Company: Kroger
Median full-time total worker compensation (2009-2015): $20,420
2014 total CEO compensation: $12,987,582
Ratio of CEO pay to median worker pay: 636
Barbara Rentler
Company: Ross Stores
Median full-time total worker compensation (2009-2015): $19,120
2014 total CEO compensation: $12,083,834
Ratio of CEO pay to median worker pay: 632
Robert D. Marcus
Company: Time Warner Cable
Median full-time total worker compensation (2009-2015): $55,006
2014 total CEO compensation: $34,615,597
Ratio of CEO pay to median worker pay: 629
Satya Nadella
Company: Microsoft
Median full-time total worker compensation (2009-2015): $137,000
2014 total CEO compensation: $84,308,755
Ratio of CEO pay to median worker pay: 615
Robert A. Iger
Company: Walt Disney Company
Median full-time total worker compensation (2009-2015): $79,211
2014 total CEO compensation: $46,497,018
Ratio of CEO pay to median worker pay: 587
Lawrence J. Ellison*
Company: Oracle
Median full-time total worker compensation (2009-2015): $117,415
2014 total CEO compensation: $67,261,251
Ratio of CEO pay to median worker pay: 573
*Ellison is no longer CEO of Oracle.
Hubert Joly
Company: Best Buy
Median full-time total worker compensation (2009-2015): $25,160
2014 total CEO compensation: $13,881,219
Ratio of CEO pay to median worker pay: 552
Brian L. Roberts
Company: Comcast
Median full-time total worker compensation (2009-2015): $59,745
2014 total CEO compensation: $32,961,056
Ratio of CEO pay to median worker pay: 552
Gregory D. Wasson*
Company: Walgreens
Median full-time total worker compensation (2009-2015): $30,980
2014 total CEO compensation: $16,732,555
Ratio of CEO pay to median worker pay: 540
*Wasson is no longer CEO of Walgreens.
Philippe P. Dauman
Company: Viacom
Median full-time total worker compensation (2009-2015): $82,094
2014 total CEO compensation: $44,334,858
Ratio of CEO pay to median worker pay: 540
D. Scott Davis*
Company: UPS
Median full-time total worker compensation (2009-2015): $31,880
2014 total CEO compensation: $16,994,449
Ratio of CEO pay to median worker pay: 533
*Davis is no longer CEO of UPS.
Leonard S. Schleifer
Company: Regeneron Pharmaceuticals
Median full-time total worker compensation (2009-2015): $79,332
2014 total CEO compensation: $41,965,424
Ratio of CEO pay to median worker pay: 529
Ralph Lauren
Company: Polo Ralph Lauren
Median full-time total worker compensation (2009-2015): $47,452
2014 total CEO compensation: $24,537,936
Ratio of CEO pay to median worker pay: 517
John Robert Strangfeld, Jr.
Company: Prudential
Median full-time total worker compensation (2009-2015): $72,771
2014 total CEO compensation: $37,483,092
Ratio of CEO pay to median worker pay: 515
Carol Meyrowitz
Company: TJX Companies
Median full-time total worker compensation (2009-2015): $44,922
2014 total CEO compensation: $22,514,033
Ratio of CEO pay to median worker pay: 501
Steven M. Mollenkopf
Company: Qualcomm
Median full-time total worker compensation (2009-2015): $121,249
2014 total CEO compensation: $60,740,592
Ratio of CEO pay to median worker pay: 501
The post 26 CEOs who earn at least 500x what their median employee makes appeared first on Business Insider.
Source:: Business Insider