May Anderson and Paul Haroff, AP Business Writer
NEW YORK (AP) – A typical compensation package for CEOs operating companies on the S&P 500 surged nearly 10% in 2024 as the stock market enjoyed another banner year and corporate profits rose sharply.
Many companies listen to calls from shareholders to connect CEO pay more closely to performance. As a result, the majority of the pay package consists of stock awards. CEOs cannot cash in years or years unless they meet certain targets, typically unless they meet a higher stock price or market value or an improved operating profit.
The CEO Compensation Survey of APACTION PRESS used data analyzed by Equilar to include pay data from 344 executives from S&P 500 companies, including payment data from S&P 500 companies that filed powers of attorney between January 1st and April 30th.
Here are some important points from the survey.
A good year at the top
The median CEO wage package rose to $17.1 million, up 9.7%. Meanwhile, the median employee of the company surveyed earned $85,419, an increase of 1.7% year-on-year.
Last year, CEOs had to navigate sticky inflation and relatively high interest rates, requiring a decline in consumer reliability. But the economy also provided tail winds. Consumers continued to spend despite fears about the economy. Inflation has subsided somewhat. The Fed has cut interest rates. And the job market remained strong.
The S&P 500, the main benchmark in the stock market, rose more than 23% last year. Companies within the index rose more than 9%.
“As 2024 was expected to be a strong year, the (almost) 10% increase is worth the timing of wage decisions,” said Danladin, partner of the Compensation Advisory Partner.
Sarah Anderson, who leads the Global Economy Project at the Progressive Institute for Policy Research, said there has been a recent “long-term” increase in workers’ salaries, especially for those at the bottom of wage measures. But she said that when there are too many workers in the world’s wealthiest countries, she still has a hard time paying her bills.
Top earners
Rick Smith, founder and CEO of Axon Enterprises, headed the survey with a salary package worth $164.5 million. Axon, which makes Taser Stun Guns and Body Cameras, recorded annual record net profit of $377 million in 2024, with revenues rising by more than 30% for the third consecutive year.
Almost all of Smith’s wage packages are made up of stock awards and can only be received if they meet stock price and management-related targets for the period 2024-2030.
Other top winners in the survey include current CEOs of GE Aerospace E ($87.4 million), Apple’s Tim Cook ($74.6 million), Carrier Global’s David Gitlin ($65.6 million), and Netflix’s Ted Sarandos ($61.9 million). The majority of these paid packages consisted of stock or options awards.
According to the comparable, the median stock awards rose almost 15% last year compared to a 4% increase in base salary.
“For CEOs, the long-term goal incentives consistently increase each year than pay and bonuses,” says Melissabreck, who is also a partner in the Compensation Advisory Partner. “This trend makes sense given the important role that long-term incentives play in executive pay.”
Jackie Cook of Morningstar Sustainalytics said the advantage of linking CEO pay to performance is that “its stock-based pay appears to provide a clear market signal that most shareholders care about.” However, she says that greater use of stock-based wages has led to “amazing rises” of CEO compensation, “tracking market performance in recent years,” and “increasing wage gaps within the workplace.”
Some well-known billionaire CEOs are low on the AP survey. Warren Buffett’s compensation was valued at $405,000, about five times the amount made by Berkshire Hathaway workers. According to Tesla’s representative, Elon Musk was not compensated for 2024, but was awarded a multi-year package in 2018, valued at $56 billion and covered by the court battle.
Other prominent CEOs did not meet the criteria for inclusion of the survey. Starbucks’ Brian Nicole received a salary package worth $95.8 million, but he took over as CEO on September 9th. Nvidia’s Jensen Huang saw his compensation increase to $49.9 million, but after April 30 the company filed representation.
Wage disparity
In half of the AP annual salary survey companies, the CEO would need workers in the middle of the 192-year company wage scale to create what they did to one. Companies have had to disclose this so-called wage rate since 2018.
Wage rates usually tend to be the highest in companies in low wage industries. For example, at Cruise Line Company Carnival Corp., CEOs earned nearly 1,300 times the median wage of $16,900 for workers. McDonald’s CEO will make workers a central wage for the company about 1,000 times more. The two companies have business across many countries.
Overall, wages and benefits networked by private sector workers in the US increased by 3.6% until 2024, according to the Labor Bureau. The average US worker earns $65,460 a year. That figure rises to $92,000 if it includes benefits such as healthcare and other insurance.
“We still have a big problem with the excessive pay gap as CEO pay continues to rise,” Anderson said. “These huge disparities are not only unfair to low-level workers who are making a significant contribution to the value of the company, but they also undermine the effectiveness of the company by lowering employee morale and increasing turnover.”
Some benefits for female CEOs
The median salary for the 27 women surveyed by the Associated Press (the highest number dated back to 2014) rose 10.7% to $20 million. This increases 9.7% of male counterparts to $16.8 million.
The highest earner of female CEOs was Otis’ Judith Marks worldwide, with a pay package of $42.1 million. Known for its elevators and escalators, the company has had operating profits of over $2 billion for the fourth consecutive year. The approximately $35 million in compensation for Marks was in the form of an equity award.
Other top female CEO winners were Citigroup’s Jane Fraser ($31.1 million), advanced microdevice Lisa SU ($3.1 million), General Motors’ Maryborough ($29.5 million), and Williams Sonoma’s Laura Alber ($27.7 million).
Christy Glass, a professor of sociology at Utah State University, studies equity, inclusion and leadership, and while there may be even fewer women on the list of top CEOs, the overall stock trend has stagnated, especially as companies cut DEI programs.
“There are a few more names on the list, but they don’t move the needle much,” she said.
Security prioritization
Equilar has discovered that more companies are offering security difficulties as part of their executive compensation package, possibly in response to the December shooting of United Healthcare CEO Brian Thompson.
Equilar said an analysis of 208 S&P 500 companies that filed a proxy statement by April 2 showed median security spending rose to $94,276 from $69,180 in 2023.
Some of the companies that increased their security perks were among those that provided healthcare services to Medicare and Medicaid, and healthcare services to chipmaker Intel.
Washington reporters Matt Ott and Chris Lugerber contributed.
Original issue: May 29, 2025, 8:47am EDT
