Most CEOs Aren’t Overpaid

Despite the headlines, the vast majority of CEOs don’t take home anything close to the $9.0 million that the average S&P 500 company CEO did in 2010.  According to a new research report from Chief Executive Group, the average private company CEO with at least $5 million in revenues had a total compensation package of $1.3 million, with a median of $405,000.

“Making generalizations about CEO pay based on the S&P 500 or public company averages is equivalent to saying all actors are overpaid based on the what Adam Sandler and Johnny Depp make, ignoring all the millions of starving actors who wait tables to make ends meet” said co-author Michael Bamberger of Chief Executive Group.  He noted there are 5.7 million companies in the U.S and only 6,473 of these companies are public (0.13%).

“Being a CEO is one of the most challenging jobs in the world” according to study co-author Wayne Cooper, “and the fact that less than half of CEOs who run companies doing $5 million or more in revenue (and less than 20% of companies do that) earn less than $405,000 shows that the vast majority of CEOs are not overpaid”.

More information about the study, which includes information on base salaries, bonuses, equity gains, benefits and perks and how CEO Compensation varies by company size, industry, type of ownership and geographic region, can be found here.