Close this search box.
Close this search box.

Ranking CEO Wealth Creation for 2014

Our ranking is based on the performance of companies in the S&P 500 index (and their CEOs) for the three years ending on June 30, 2014. Only companies for which the CEOs were in their roles for the entire July 2011 through June 2014 period were ranked. Not ranked are the 18 REITs in the June 30, 2014 S&P 500 Index. (Also, Facebook, which went public in May 2012, was not ranked due to incomplete data for the measurement period.)

For this year’s wealth-creation ranking (see p. 40), we’ve adopted a methodology recommended by Bennett Stewart, CEO of EVA Dimensions. CEO performance was assessed using four measures based on the concept of economic value added (EVA). EVA is the profit remaining after subtracting the full cost of capital for the business—known as economic profit.

The first measure, EVA Momentum, shows the trend in the growth of the firm’s EVA profits over the past three years. It is better at measuring wealth-creation over time than growth in sales, EBIT, EBITDA or earnings per share, since it only counts profit growth after covering the full cost of capital, including a minimum shareholder return to compensate for risk.

The second measure, EVA Margin, shows how profitable the firm is per dollar of sales. Its value combines pricing power, operating efficiency and how well assets were managed into a single net margin score.

The third measure, market-implied momentum (MIM), measures the expected long-run growth rate for economic profits that are reflected in the company’s stock price. It shows how well the CEO has positioned the company for continued profitable expansion—through initiatives targeting growth markets, innovations, brand value and operations excellence—as far as investors can tell.

The final measure, MVA margin, is a wealth-creation index. MVA, or market value added, is the difference between a firm’s market value and the capital it has invested in business assets expressed as a percent of sales. The higher it is, the better—there’s more shareholder wealth—and a greater franchise value stemming from the business.

All of the measures were computed for each company using June 30, 2014 share prices and the most recently reported financial data up to, but not after, June 30, 2014. The measures were then ranked within their industry groups to arrive at percentile scores. A company’s final score is a weighted combination of the four percentile scores. The best-performing companies in each industry rise to the top, and those at the very top consistently outperform their industry peers across all four measurement categories. They exhibit outstanding profitability, an exceptional rate of profitable growth, a premium stock price and justification for continued confidence in their future success.

Please note that because we changed the scoring methodology this year, last year’s scores, shown for comparison, were recalculated using the new methodology described above.
The top-50 companies in the ranking delivered an average total shareholder return (TSR) of 86.2 percent between July 2011 and June 2014 (the period covered in the reported financials). The bottom-50 companies’ TSR averaged 37.5 percent, while the actual TSR for all of the scored S&P 500 companies was 68.9 percent. The top-50’s median TSR was 77.7 percent; the bottom-50’s was 38.4 percent.

As the table at bottom shows, the top-50 companies in the wealth-creation ranking far outperformed the bottom-50 companies and the scored S&P 500 between July 2011 and June 2014. [Note: Total Shareholder Return = share-price return percent plus reinvested dividends, expressed as a percent.]




  • Get the CEO Briefing

    Sign up today to get weekly access to the latest issues affecting CEOs in every industry
  • upcoming events


    Strategic Planning Workshop

    1:00 - 5:00 pm

    Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process

    Executives expressed frustration with their current strategic planning process. Issues include:

    1. Lack of systematic approach (70%)
    2. Laundry lists without prioritization (68%)
    3. Decisions based on personalities rather than facts and information (65%)


    Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns.  They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning.  Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process.  This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented.  If you are ready for a Strategic Planning tune-up, select this workshop in your registration form.  The additional fee of $695 will be added to your total.

    To sign up, select this option in your registration form. Additional fee of $695 will be added to your total.

    New York, NY: ​​​Chief Executive's Corporate Citizenship Awards 2017

    Women in Leadership Seminar and Peer Discussion

    2:00 - 5:00 pm

    Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations. 

    Limited space available.

    To sign up, select this option in your registration form. Additional fee of $495 will be added to your total.

    Golf Outing

    10:30 - 5:00 pm
    General’s Retreat at Hermitage Golf Course
    Sponsored by UBS

    General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.

    The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.

    To sign up, select this option in your registration form. Additional fee of $295 will be added to your total.