CEO Pay Continues To Rise
Jun 06, 2011
Although most Canadians still find themselves slowly fighting their way out of the economic downturn of 2008 and 2009, Canada’s top chief executive officers have had no such difficulty.
A Globe and Mail review of executive pay for 2010 found that CEOs at Canada’s 100 largest companies saw their compensation jump 13 percent, most of this resulting from a 20 percent increase in annual cash bonuses. Base salaries climbed four percent.
The 2010 gains for CEOs came after two years of “weakness” in 2008 and 2009 which saw compensation drop by five percent and increase by less than one percent, respectively.
Although escalating CEO salaries are a familiar sight, compensation experts are insisting that the climate for executive pay is changing thanks to aggressive lobbying by large shareholders and the added pressure of “say-on-pay” votes, which give investors the ability to vote on executive pay practices at many large companies.
If true, this is a form of progress. But performance-based pay still remains a work in progress for Canada’s highest paid executives. Many boards remain hesitant to add extra performance hurdles for executives, as they believe the old system worked fine and they are not eager to try anything different.
Hopefully, we are seeing the beginning of a change in culture, so that executive pay will evolve to more closely mirror the value of their performance.
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