Shareholder opposition builds in US against overpaid CEOs

US-based shareholder advocates As You Sow has released its listing of the most ‘overpaid’ heads of US business.

The 100 Most Overpaid CEOs: Are Fund Managers Asleep at the Wheel? the report, focuses on the nexus between overpaid CEOs of the S&P 500, and the failure of pension and mutual funds to hold companies accountable for excessive compensation.

The report marks the fifth year As You Sow has provided these research results and charts the rise of major shareholder action against CEO pay packages. Several funds, with assets of more than $100bn each have more than doubled the number of CEO pay packages they vote against.

Despite this action, CEO pay has continued to increase. The average pay for a CEO in the S&P 500 grew from $11.5m in 2013 to $13.6m in 2017. According to the report the companies with overpaid CEOs identified in the first report in 2015 have markedly underperformed the S&P 500.

Also, it is interesting to note that in the US pension funds give CEO pay packages more scrutiny and a greater level of opposition than financial manager controlled funds. Also, in general, European-based investment funds vote against CEO pay packages at a greater rate than US-based ones.
Ronald Clarke of Fleetcor Technologies tops the As You Sow list at more than $52ma year with a pay ratio of 1517:1 (the ratio of the pay of the CEO to the pay of the corporation’s median worker). Oracle comes in second after topping the list last year and Broadcom in third. The CEOs of Mondelez International, Wynn Resorts and Walt Disney rank 4th, 5th and 6th, respectively.

Full report here.
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