CHARLOTTE, N.C. — It was a tough year for the region’s 40 largest public companies, but you might not be able to tell by compensation awarded to most of their CEOs.
Those companies’ aggregate net income plunged 26% from the year before as Covid-19 plagued 2020. The aggregate total CEO compensation for the 38 companies that had also been public in 2019 increased 18.5% over the same period.
[ ALSO READ: Public paychecks: Who are the city of Charlotte’s highest-paid employees? ]
Ya-wen Yang, who studies executive compensation as an associate professor at the Wake Forest University School of Business, says finding the balance for executive pay and performance has been challenging at the best of times. But in the pandemic, there are even more factors a board must weigh.
The board may want to factor in the nimbleness of a CEO’s response to unexpected events, she says. Where there is some discretion, boards may look to incentives to help right the ship. “Every time when company performance or the economy is going south and CEO pay is going up, it is a hot topic,” she says.
It’s a mixed bag here, but 23 public companies in the Charlotte region saw lower net income and yet CEO packages were down at only 15. And two of those that had lower CEO compensation involved a change in chief executives from one year to the next, with the new CEO making substantially less than the predecessor.
[ ALSO READ: Coronavirus: US investing $3.2 billion to develop pills to treat COVID-19 ]
In gross numbers, net income for the region’s 40 big public companies was down to $35.4 billion, with 17 companies reporting net losses on the year. In 2019, the aggregate net income totaled $47.6 billion, with 12 companies reporting losses.
The aggregate pay to executives in 2020 totaled $422.7 million. But more than $90 million of that was paid to executives at two newly public companies that were privately owned in 2019.
Comparing the 38 companies that reported CEO packages for 2020 and 2019, the aggregate for 2020 drops to $332.3 million. That compares with $280.6 million paid by those companies in 2019.
Read more about what specific CEOs made last year, how their companies performed and industry observers’ takes on the trends.
Read more here.
This browser does not support the video element.