Every year, there’s a lot of misinformation when it comes to executive compensation. The headlines typically focus on public companies—and, more specifically, on Fortune 500 CEOs. Lumping all chief executives and senior executives in together based on this small subset, as if they’re some homogeneous pack, is, of course, intellectually lazy. But more pragmatically, the lack of information for private companies across all revenue ranges—which form the largest part of American enterprise—means many organizations make uninformed and reactive compensation decisions.
Further muddling the compensation landscape, the pandemic has forced companies to adjust their executives’ base pay to navigate the crisis. As businesses begin to adapt to a Covid world, there’s never been a more challenging time to ensure they offer competitive compensation programs to attract, retain and align the top talent that will ensure the health of their businesses. To succeed in a post-Covid environment, companies will need to be proactive with their pay strategy, rather than reacting—often too late—after top talent walks out the door.
Enter Chief Executive. In our just-released 2020-21 CEO & Senior Executive Compensation Report for Private Companies, we dug into the immediate impacts of Covid on leadership pay and found that 37 percent of private companies in the U.S. reduced their CEO’s base salary in 2020 in response to the crisis—the majority of which report cuts of 10 percent to 30 percent.
Perhaps unsurprisingly, nearly 70 percent of companies in the restaurant industry slashed CEO pay. But media CEOs were hit even more often—and advertising/marketing and entertainment industry chiefs were cut as well. Financial services, biotech, pharma and construction leaders were the least impacted, our survey found.
The research also shows that of those companies cutting their CEOs’ base salary in 2020, the majority were doing so for at least three months—and a whopping 45 percent say the reductions will either remain in place until the end of the year or until such time when the company is profitable again.
As a result of the crisis response, median CEO cash compensation for 2020 is expected to decrease by 15 percent: a 5 percent cut to base salary and 60 percent to bonus awards.
ABOUT THE REPORT: With data collected from 1,780 companies, the 2020-21 CEO & Senior Executive Compensation Report for Private Companies, available now, showcases more than 140,000 data points—including values by industry, ownership type and company size. Order the report >
Chief Executive Group exists to improve the performance of U.S. CEOs, senior executives and public-company directors, helping you grow your companies, build your communities and strengthen society. Learn more at chiefexecutivegroup.com.
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
Executives expressed frustration with their current strategic planning process. Issues include:
Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns. They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning. Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process. This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented. If you are ready for a Strategic Planning tune-up, select this workshop in your registration form. The additional fee of $695 will be added to your total.
2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
Limited space available.
10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.
