CEOs aren't disclosing their real compensation. The pay gap is much worse than you think.

Beginning this year public companies must compare the pay of their CEO with that of their median employee. Required by Dodd-Frank, disclosure of this CEO pay ratio has produced some jaw-dropping numbers. Aptiv, a maker of auto parts, reported that its CEO made 2,526 time more that its median employee. The CEO pay ratio was 2,483 to 1 at the temp agency ManpowerGroup, 1,804 to 1 at amusement park owner Six Flags, and 1,465 to 1 at Del Monte Produce. READ MORE

The ‘Hidden’ Tax Cost of Executive Compensation

The sweeping tax reform enacted in December 2017 will significantly increase the tax cost of executive compensation in publicly held corporations where the compensation for each of the top five executives exceeds $1 million. Nonetheless, it is unlikely that these corporations will reduce the executive compensation to offset the increased tax cost, which will likely be shifted to public shareholders.  READ MORE

Executive Compensation and Employee Benefits Following the Tax Cuts and Jobs Act of 2017

Effective December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Act”) made significant changes to certain provisions of the Internal Revenue Code of 1986 (the “Code”).

While there was much discussion and analysis of the Act leading up to its enactment, the Act contains many changes to the federal income tax treatment of executive compensation and/or employee benefits of which corporate executives, officers and human resource personnel should be aware to ensure the proper federal income tax treatment and reporting of such items, while satisfying the financial goals to be attained by the recipient employees. READ MORE

Executive Compensation as Corporate Waste? Delaware Court Allows a Lawsuit to Continue

I don’t believe that any court has decided in favor of plaintiffs alleging that the payment of executive compensation was a breach of fiduciary duty for a waste of corporate assets—until now. The reason is that (in the face of the business judgment rule) corporate waste is very difficult to prove. But last week, the Delaware Chancery Court allowed plaintiffs to continue with their shareholder derivative claims against the board of CBS Corporation in Feuer v. Redstone.  READ MORE

How Much Do CEOs Make?

Median pay reached $12.1 million for CEOs of the biggest U.S. companies in 2017, a new post-recession high, as profits and stock prices soared. Most S&P 500 CEOs received raises of 9.7% or better last year, according to a WSJ analysis of data from MyLogIQ. Scroll to see the highest-paid CEOs, and the lowest, as well as comparisons of shareholder returns and worker pay.  READ MORE

Elon Musk’s Unusual Compensation Plan Isn’t Really About Compensation at All

Earlier this year, Tesla shareholders approved what is likely the largest compensation package ever awarded to a CEO — for a CEO who clearly doesn’t need the money. Elon Musk is already incredibly rich, and also doesn’t seem particularly motivated by further wealth. The psychologist Daniel Pink describes the primary sources of human motivation for people who have covered their most basic needs, such as food and shelter, as being autonomy, mastery, and purpose — and Musk seems like a prototypical example of that. He enjoys the autonomy to pursue moon shot projects, constantly strives for mastery in what he does, and has a strong sense of purpose. And yet this contradiction of motivations has mostly been absent from discussion of Musk’s pay.  READ MORE

Here's what a median compensation looks like at Amazon, Alphabet, Facebook, and other big tech companies

A middle-of-the-pack employee at Facebook makes more than 8 times as much as Amazon's median employee.

The revelation of that stark difference comes courtesy of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which required companies to disclose the ratio between their median paid employee's compensation and their CEO for the first time this year.  READ MORE

Do Media Chiefs Deserve the Lavish Pay Packages They Rake In?

It’s good to be the king, Mel Brooks famously joked in “History of the World: Part 1.”

When it comes to the entertainment business, he was especially right. There’s never been a richer time to wear the crown at the media conglomerates that churn out the world’s most popular television shows and movies. CBS’ Les Moonves, Discovery’s David Zaslav and Time Warner’s Jeff Bewkes each took home salary and compensation packages in 2017 that dwarfed those of Silicon Valley pashas such as Apple’s Tim Cook ($12.8 million) or Facebook’s Mark Zuckerberg ($8.9 million), despite the fact that Cook’s and Zuckerberg’s companies boast far greater market share and cultural cachet. READ MORE

The Catch 22 of the Disclosure Season: Was the Supplemental CEO Pay Ratio Worth It?

For better or worse, the SEC’s regulations implementing the CEO Pay Ratio disclosure requirement provided public companies a great deal of leeway to calculate and disclose. One of the items most deliberated with our clients was whether or not to provide a supplemental pay ratio using a different methodology from the required rules. Highlights of our analysis of data captured in mid- April indicate that:  READ MORE