Blogs & Comment

CEO Compensation Increases

Last year the 60 CEOs of Canada’s largest companies were paid $647,133,700 or an average of $10,785,600. That’s over $200,000 per week and up 41% from the amounts paid in 2006. Almost half of this was profits realized from the exercise of company options. Compensation ranged from $550,000 per year for Michael Grandin at Fording Canadian Coal Trust to $51,516,000 for Michael Lazaridis at Research in Motion. By using figures provided by the Canada Customs and Revenue Agency we calculated that it would take a little over 16,200 Canadians with an average income of $39,915 each to make as much as these 60 gentlemen did.
Did the 41% increase in total CEO compensation translate into a comparable rise in shareholder return. In a word, NO. The average total shareholder return in 2007 for the companies involved was 13.2% meaning the CEOs got 27.8% more in compensation than shareholders got in return. Below is a table showing the 60 CEOs, the companies, total 2007 compensation, percent change from 2006, total shareholder return in 2007 and the difference between the increase in individual CEO compensation and the company’s total return. In the difference column positive numbers indicate the CEO’s increase was more than the shareholder return and negative numbers mean the CEO’s increase was less.