Religious intimidation » « Rational or irrational fear?

Ratio of average CEO v. worker pay by country

I got this from The Progressive Review but since the site did not cite a source, I cannot vouch for the accuracy of the data used to generate it.

Update: See the comment by savannahbarnett below that suggests that the data is unreliable and out of date, although the link to better supported data shows that the ratio in the US is still very high, in the 185 to 325 range.

Religious intimidation » « Rational or irrational fear?

Comments

  1. savannahbarnett says

    Hi Mano, it seems to be a chart that came out of a class project that isn’t well cited. PolitiFact did an analysis of it and labeled it “false” (http://www.politifact.com/truth-o-meter/statements/2011/oct/10/facebook-posts/viral-facebook-post-ceo-worker-pay-ratio-has-obscu/) It seems as though there aren’t good numbers on CEO to average worker pay (I don’t believe non-public companies have publish salary data), but there is still an astounding gap in pay.

  2. Leander says

    I can not say anything about the accuracy of the american ratios, (in 2005 they stood at approx. 260 to 1…) but the european ones seam to be correct.

  3. 'Tis Himself, OM. says

    CNN Money says:

    In 2010, chief executives at some of the nation’s largest companies earned an average of $11.4 million in total pay — 343 times more than a typical American worker, according to the AFL-CIO.

    …

    According to the AFL-CIO, in 1980, CEOs at the largest companies received 42 times the pay of the average worker. In 2000 the gap hit a high, with CEOs making 525 times the average worker.

    In 2010, the gap narrowed with CEOs making 343 times the average worker, said [AFL-CIO President] Trumka, who himself makes roughly four times the average worker.

  4. 'Tis Himself, OM. says

    The Washington Post has an interesting story about the dynamics of CEO pay. Its lead example is Kevin Sharer, the CEO of Amgen:

    Shareholders at the company, one of the nation’s largest biotech firms, had lost 3 percent on their investment in 2010 and 7 percent over the past five years. The company had been forced to close or shrink plants, trimming the workforce from 20,100 to 17,400. And Sharer, a 63-year-old former Navy engineer, was already earning lots of money — about $15 million in the previous year, plus such perks as two corporate jets.

    The board decided to give Sharer more. It boosted his compensation to $21 million annually, a 37 percent increase, according to the company reports.

    Why? In part, because Amgen’s board wanted to pay Sharer more than what 75 percent of his CEO peers are paid, a common approach among corporate boards. However, if all CEOs are going to be paid better than average, that average is going to rise much more quickly than pay-for-performance would dictate.

    And then there’s the fact that corporate boards tend to be quite chummy with their CEO, who technically is just an employee of the company.

    At Amgen, for example, four of the six members of the board compensation committee had personal or business connections to Sharer before joining the board. In fact, he nominated at least two of the six to the board, according to a company source and reports.

    These kinds of ties — between chief executives and the boards that oversee them — permeate corporate America. On a typical board, the chief executive considers about about 33 percent of the board of directors as “friends” rather than as mere “acquaintances,” according to a survey of chief executives at about 350 S&P 1500 corporations conducted over 15 years by University of Michigan business professor James Westphal.

    This is a market that is broken, and those who control it have every reason to insist that it remain broken.

  7. J. Patrick Malone says

    To correct a point you made regarding actual data on CEO compensation;

    The Section 953(b) of the Dodd-Frank Act requires public companies to disclose the ratio of the chief executive officer’s compensation (as disclosed in their own Summary Compensation Table) to the annual median employee compensation (calculated as if in the Summary Compensation Table).

    These numbers are extraordinarily easy to come by … you just have to go to the company website and start digging (it may require mailing a request for their company prospectus).

    Cheers!

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