CEOs see hefty pay raises

CEO PAY

Broadcom’s Hock Tan was leader with pay, stock at $162 million

Prologis CEO Hamid Moghadam speaks with Chinese Premier Li Keqiang, not shown, during a meeting with representatives of the 4th Round-Table Summit of the “Global CEO Council” in Beijing in 2016. Moghadam was among the highest paid CEO’s in 2023 according to an Associated Press survey.

The typical compensation package for chief executives who run companies in the S&P 500 jumped nearly 13% last year. AP’s CEO compensation study included pay data for the top earners, who include Hock Tan of Broadcom Inc., left, Tim Cook of Apple Inc., Hamid Moghadam of Prologis Inc., Ted Sarandos, co-CEO of Netflix. THE ASSOCIATED PRESS

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By Mae Anderson, Paul Harloff and Barbara Ortutay

The Associated Press

The typical compensation package for chief executives who run companies in the S&P 500 jumped nearly 13% last year, easily surpassing the gains for workers at a time when inflation was putting considerable pressure on Americans’ budgets.

Hock Tan, the CEO of Broadcom, topped the AP survey with a pay package valued at about $162 million.

The median pay package for CEOs rose to $16.3 million, up 12.6%, according to data analyzed for The Associated Press by Equilar. Meanwhile, wages and benefits netted by private-sector workers rose 4.1% through 2023. At half the companies in AP’s annual pay survey, it would take the worker at the middle of the company’s pay scale almost 200 years to make what their CEO did.

“In this post-pandemic market, the desire is for boards to reward and retain CEOs when they feel like they have a good leader in place,” said Kelly Malafis, founding partner of Compensation Advisory Partners in New York.

The AP’s CEO compensation survey included pay data for 341 executives at S&P 500 companies who have served at least two full consecutive fiscal years at their companies, which filed proxy statements between Jan. 1 and April 30.

Broadcom granted Tan stock awards valued at $160.5 million on Oct. 31, 2022, for the company’s 2023 fiscal year. Tan was given the opportunity to earn up to 1 million shares starting in fiscal 2025, according to a securities filing, provided that Broadcom’s stock meets certain targets and he remains CEO for five years.

At the time of the award, Broadcom’s stock was trading at $470. The stock has skyrocketed since and reached an all-time high of $1,436.17 on May 15. Tan will receive the full award if the average closing price is at or above $1,125 for 20 consecutive days between October 2025 and October 2027.

Broadcom noted that under Tan its market value has increased from $3.8 billion in 2009 to $645 billion (as of May 23) and that its total shareholder return during that time easily surpassed that of the S&P 500.

Other CEOs at the top of AP’s survey are William Lansing of Fair Isaac Corp, ($66.3 million); Tim Cook of Apple Inc. ($63.2 million); Hamid Moghadam of Prologis Inc. ($50.9 million); and Ted Sarandos, co-CEO of Netflix ($49.8 million).

Lisa Su, CEO of chipmaker Advanced Micro Devices, was the highest paid female CEO in the AP survey for the fifth year in a row in fiscal 2023, bringing in compensation valued at $30.3 million — flat with her compensation package in 2022. Her overall rank rose to 21 from 25.

Workers across the country have been winning higher pay since the pandemic, with wages and benefits for private-sector employees rising 4.1% in 2023 after a 5.1% increase in 2022, according to the Labor Department.

Even with those gains, the gap between the person in the corner office and everyone else keeps getting wider. Half the CEOs in this year’s pay survey made at least 196 times what their median employee earned. That’s up from 185 times in last year’s survey.