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CEO pay was up yet again last year

Reuters/Jessica Rinaldi
For people like President and CEO of Discovery Communications David Zaslav, it’s good to be the chief.
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This post has been corrected

CEO pay has been on the rise for years, and 2014 was no exception, particularly for CEOs in media, technology, and the pharmaceutical industry. Median pay among the top 200 highest paid CEOs of public US companies was $17.6 million, up 1.9% from last year according to data from Equilar, an executive compensation and corporate governance data firm.

Only two people running companies that disclose their numbers made more than nine figures this year, but notably, three of the top six slots, including those top two, are executives who have John C. Malone, the billionaire cable and communications magnate, on their board or as their chairman. (paywall) Malone has a history of giving complicated and outsize rewards to the CEOs of companies he controls, who are usually longtime lieutenants of his.

Here are the top 20 CEOs of public companies, by pay. The calculations include base salary, all bonuses, the value of stock and option awards at their grant date, and other compensation such as benefits, and is calculated by Equilar from company proxy statements:

Marissa Mayer is the only woman on the list. The next woman on the list is United Therapeutics CEO Martine Rothblatt, at the 24th spot, who made $31.6 million; followed by TJX’s Carol Meyrowitz, on the list at 54, making $23.3 million.

The pay list does not exactly align with performance. David Zaslav, who made nearly $50 million more than any other CEO last year, was actually the worst of the top 20 when it came to total shareholder return (stock price appreciation plus reinvested dividends). By that measure, his company’s shares were down 24% for the year. Five other CEOs in the top 20 for pay ran companies that had down years. (The two CEOs who for whom that data isn’t available, GoPro’s Nicholas Woodman and Liberty Media/Interactive’s Greg Maffei, aren’t listed.):

So what’s behind the run-up in pay? The dramatic rise of stock-based compensation has a lot to do with it, giving executives big payouts for stock price increases they may not have all that much to do with.

Another big one, of which there’s ample evidence this year at the top of the list, is the fact that boards are made up largely of other executives who are often inclined to reward each other.

The SEC recently released rules designed to make pay and performance more transparent, but it likely won’t do anything to address these underlying issues.

Correction (May 19th): An earlier version of this article incorrectly stated the growth in median CEO pay as 21%, the correct figure is 1.9%.

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