CEO Pay in Private Companies

Lately, the pay packages of CEOs of large public companies have been getting a lot of attention from politicians, regulators and the media. However, little has been said about how the vast majority of CEOs are paid. Given that there are more than 5.7 million companies in the U.S., but only 5,292 publicly listed companies on the NYSE and NASDAQ exchanges (just 0.09 percent), the pay packages of CEOs of public companies are only part of the story. The reality is that the vast majority of CEOs in the U.S. run small and mid-sized privately owned enterprises. However, until Chief Executive’s research team starting collecting this data for an annual CEO and Senior Executive Compensation Report for Private Companies, there was limited data on what they earned.

Now that the new 2015-16 edition of the study has been released, we can share some highlights of the findings. For private company CEOs, the report provides the hard data needed to benchmark against peers by function, industry, ownership type and more. (For more information, go to www.ChiefExecutive.net/compreport.)

Big Differences By Industry and Other Dimensions

Very few CEOs are “average,” so while median or 50th percentile data is interesting, it’s also important to look at the ranges of compensation overall and along key dimensions. For example, top quartile CEO compensation packages were 81 percent above the median pay overall, while those in the bottom 25th percentile earned only 57 percent as much as the median CEO on average.

There were also material differences by industry, type of ownership, geography, level of profitability, growth rate and other dimensions, as the charts on the right highlight.

For more information on the CEO & Senior Executive Compensation for Private Companies 2015-2016 Report, click here.