CEO pay gap between U.S. and U.K. widening
Geography plays a key role in executive compensation.
The big picture: The median pay package (salary, bonus, stock) for those who lead S&P 500 companies rose 34% from 2015 through 2021 compared to a decline of 13% for CEOs of FTSE 100 firms, the WSJ reports, citing data from Equilar and Deloitte U.K.
- The typical S&P 500 CEO made $14.5 million in total compensation in 2021 compared to about $4.5 million for FTSE 100 (biggest market caps listed on the London Stock Exchange) leaders.
Driving the difference: Financial, regulatory and cultural forces, including fewer approvals required for compensation in the U.S. and less backlash among U.S. investors on high pay.
- The structure of stock awards also drives the gap.
- U.K. CEOs typically receive performance-based payouts in later years versus more immediate performance and guaranteed shares for U.S. leaders.
What they're saying: “There’s always been a gap. The gap is getting bigger,” said Mitul Shah, head of the executive-compensation advisory unit at Deloitte, tells WSJ.
What to watch: British regulators are weighing a loosening of constraints to attract companies to the U.K. and push executives to move.