You are here
Executives at higher levels got bigger pay raise
TOP and middle executives got bigger pay hikes than those at the bottom in the last financial year, says a recent global survey (see infographic: Total compensation trend).
But while nearly half of the CEOs surveyed got a raise, the share was bigger for lower-ranked directors and executives - two-thirds, according to the 2014 AESC Blue-Steps Executive Compensation Report.
AESC is the US-based Association of Executive Search Consultants. The report covers 907 senior executives from the US (52 per cent), Europe (34 per cent) and Asia-Pacific (13 per cent) who responded to its survey in October and November.
"This survey shows that total compensation is on the rise for most executives," says AESC's president and CEO, Karen Greenbaum.
A breakdown of the numbers shows the lower down the corporate ladder, the bigger the chunk of executives who got a pay rise.
Thus, while 44 per cent of the CEOs at the top saw an increase in their total compensation, it was 66 per cent for the directors and executives near the bottom.
In between, 62 per cent of "other C-level" (not CEO) executives and 65 per cent of vice presidents - including executive and senior vice presidents - got a raise, according to the report.
But a higher percentage of CEOs reported a drop in total income in the last financial year - 14 per cent, against 10 per cent for directors and executives; and 11 per cent for both other C-level executives and vice presidents. An even higher 43 per cent of the CEOs indicated flat income, compared to 24 to 27 per cent for directors and executives, vice presidents and other C-level executives.
Yet, more at the top appeared to enjoy a bigger payout. The total pay of 17 per cent of the CEOs jumped 16 per cent or more in the last financial year; it was 14 per cent for directors and executives.
For other C-level executives and vice presidents, the figures were 28 and 23 per cent, respectively.
Nearly half - 46 per cent - of the directors and executives saw their total salary inch up just 1-5 per cent in the last financial year; only 29 per cent of the CEOs were given such low increases.
"The significant spread between those who received the greatest increase in total compensation and those who remained flat or decreased is likely an indicator that 'pay for performance' is working in terms of both cash compensation and long-term incentives," the report says.
Overall, CEOs made much more than the rest of the executives, with 45.6 per cent of them earning US$251,000 to US$400,000 yearly in base salary, while 64.7 per cent of other C-level executives earned US$151,000 to US$300,000.
Most executives at the director level - 41.8 per cent - took home US$151,000 to US$200,000 in base salary.
The report also found that the pay gap between men and women is not noticeable until the US$250,000 and higher level, where there were fewer women. Below US$250,000, male and female executives made relatively equal base salaries at each pay level.
"At the US$250,000 base salary level and above, the gender pay gap began to expand due to fewer women being represented in C-level positions," the report says.