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Politics : Stockman Scott's Political Debate Porch -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (21090)	6/26/2003 8:25:23 PM
From: stockman_scott	Read Replies (1) \| Respond to of 89467

Total Compensation for CEOs in the S&P 500 Increased by an Average of 63.24 Percent in 2002 PORTLAND, ME - June 20 - Poor pay practices and excessive compensation were key factors in each of the boards in TCL's bottom ten list of America's largest public corporations (www.thecorporatelibrary.net/ratings_press_release.html); and a new research report, showing CEO compensation spiraling ever upward, indicates that TCL’s tough stance on directors who permit excessive executive pay is needed more than ever. Instead of setting an example, it is in the biggest companies that pay is growing fastest. Total compensation for CEOs in the S&P 500 grew at a faster rate from 2001 to 2002 than it did for CEOs at companies outside the S&P 500. The average increase in total compensation for S&P 500 CEOs was 63.24 percent, compared to 51.02 percent for CEOs of non S&P 500 companies. “We look to the largest companies to lead the way in reform, but only a very few have made any attempt to rein in compensation,” said Paul Hodgson, senior research associate at The Corporate Library and author of the report, 'What Really Happened to CEO Pay in 2002', published today, The analysis is based on a matched sample of 1,019 CEOs who were in the job for the full fiscal year in 2001 and in 2002. The average increase in total annual compensation – including base salary and annual bonus – was also higher in the S&P 500 than in companies outside that group. The average rate of increase in total annual compensation was 26.65 percent for S&P 500 CEOs and 23.28 percent for other CEOs. Over the same period, the S&P 500 Index was down 23.3% and the S&P 1500 Index was down 22.5%. Given the relatively low increases seen for base salary, the growth rate for total annual compensation and total compensation shows a significant rise in incentive payments. Total compensation includes all long-term incentives – restricted stock grants, profits from stock options and other long-term bonus payouts. But the economy’s performance would not seem to justify such growth rates. Some analyses from earlier in the year suggested that the recovery in incentives was a result of particularly poor performance in 2001, it was pay bouncing back from a bad year. But, in a separate analysis of matched CEOs in the S&P 500, Hodgson confirmed that 2002 also showed real growth over pay in 2000. Bonuses, restricted stock grants and profits from stock options were all higher in 2002 than in 2000. “To confirm the overall impression of continuously climbing CEO compensation, the median increase in total compensation for this same matched group of CEOs was 90.83 percent between 2000 and 2002,” commented Hodgson. The survey also looks at compensation levels for a larger sample of CEOs who have been in their jobs for the full 2002 fiscal year. Average total compensation for CEOs in the S&P 500 was nearly $6.4MM, and nearly $2.4MM for other CEOs. The highest total compensation for an S&P 500 CEO was found at Tenet Healthcare, where CEO Jeffrey Barbakow received a total of $116,682,680 largely as a result of the exercise of 3MM stock options. Outside the S&P 500, Dwight Schar, CEO of construction company NVR, earned the highest total compensation of $94,303,279, again largely due to profits from the exercise of options. “While the returns on the exercise of stock options by NVR’s CEO Dwight Schar could be considered excessive, there is little doubt that the company has performed extremely well over the long term, with a total stockholder return over five years of 926.93 compared to 11.76 for its construction industry peers. Even with the award of index-linked stock options, the rewards would have been extremely high. Schar made a profit of around $261 per share on the exercise of 333,333 options,” said Hodgson. The full report is available free from The Corporate Library at thecorporatelibrary.com . ----------------------------- commondreams.org