Such barbed criticism used to be the norm, but lately the furor over executive pay seems to have died down. Why the relative silence? To start with, stronger corporate profits have satisfied shareholder groups. And many Americans assumed that top managers would get their comeuppance after President Clinton limited the tax deductions corporations could take for executive salaries to $1 million. Dead wrong. Total pay rose by more than 8 percent last year. Most companies merely tilted compensation more toward bonuses and stock options. Just how much did most CEOs make? Median total pay was $2 million, says Standard & Poor’s Compustat, which compiles a yearly compensation evaluation for Business Week. Getting paid well is its own reward, of course. But a few top earners deserve special recognition for their achievements in 1993:
Sanford Weill, the CEO of Travelers Corp. This year he came in second only to Eisner in the big-bucks derby, raking in $53 million, including stock options. But he’s placed in the past two years as well, earning $68 million in 1992 and nearly $16.7 million in 1991, according to Compustat. Still, that didn’t stop him from cutting some of his workers’ benefits, such as pensions and health coverage.
John Morgridge of Cisco Systems. The founder and CEO of a $1 billion-in-sales Silicon Valley company, which produces computer-networking gear, was paid $360,000 last year. In the past three years, shareholders have seen their investment increase tenfold.
Retired IBM CEO John Akers presided over Big Blue during a period in which the value of its stock plunged $28 billion. Still, he received a $2.5 million severance check, an annual pension of $1.3 million, stock options and a $125,000 bonus.
Charles Mathewson, chairman of International Game Technology. While his slot-machine company took in just $544 million last year and showed net profits of $127 million, he pocketed a cool $22.2 million, mostly by cashing in stock options, Compustat says.
Herbert and Marion Sandler, the husband-and-wife team that runs Golden West Financial, a California-based savings and loan, were paid identical salaries last year: $847,000 apiece, plus more than $2.7 million in options.
Turi Josefsen and Leon Hirsch didn’t fare too badly, either. The CEO and executive vice president of troubled U.S. Surgical saw a drop in their bonuses, but their salaries increased by 4 percent in 1993. Together, they walked away with $2.5 million in salary, bonuses and long-term payouts even though the company was forced to reduce its work force by 20 percent.
Joseph Bachelder. No, he’s not a CEO. But the heavy-hitting lawyer negotiates compensation packages for such superstar CEOs as IBM’s Louis Gerstner and Allied-Signal’s Larry Bossidy. Insiders say his specialty is obtaining low-risk, high-return contracts and bonuses not tied to performance.
