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Most chief executives of major corporations earn millions of dollars in base salary, but that's not all they get (just take a look at how the highest-paid CEOs in America make their money).
Total CEO compensation includes perquisites, bonuses, and stock options, among other things.
In fact, the great bulk of CEO compensation does not come from base salaries. Even the highest CEO base salaries fall under $10 million. It's all the other goodies that push total CEO compensation miles past $10 million.
Research firm GMI Ratings does an annual study of the total compensation of U.S. CEOs to determine just how much money each actually ends up within the course of a given calendar year.
Last week, GMI released the results for 2012 - and the numbers may stun you.
The total CEO compensation for two chief executives exceeded $1 billion, and every CEO in the top 10 walked away with more than $100 million.
This posh group collectively raked in a combined $4.7 billion in 2012. Tellingly, about $3.3 billion of that was associated with stock options.
"While stock options are intended to align the interests of senior executives with shareholders, the unintended consequence of these grants is often windfall profits that come from small share price increases," wrote senior research analyst Greg Ruel in the GMI report.
GMI said median CEO compensation of the entire sample of 2,200 chief executives rose 8.47% from 2011, while those running Standard & Poor's 500 companies enjoyed a 19.65% increase.
Meanwhile, the average American worker lost ground, with median household income falling 0.2% in 2012. That's 8.3% lower than where the median household income stood in 2007, before the Great Recession began.
Heidi Moore, economics editor at The Guardian, told Yahoo Finance's The Daily Ticker that
the disconnect between compensation for workers and CEOs is actually bad for the U.S. economy.
"It's potentially one of the reasons our economy is not moving forward," she said. "You'll find that inequality usually rises as an economy struggles."
While it's true that "hard work does lead to great benefits, it's also important to remind people that they often overestimate what their contribution is to overall outcome to the company or a project," Moore said.
With that said, here are last year's 10 biggest winners in total CEO compensation...
About the Author
David Zeiler, Associate Editor for Money Morning at Money Map Press, has been a journalist for more than 35 years, including 18 spent at The Baltimore Sun. He has worked as a writer, editor, and page designer at different times in his career. He's interviewed a number of well-known personalities - ranging from punk rock icon Joey Ramone to Apple Inc. co-founder Steve Wozniak.
Over the course of his journalistic career, Dave has covered many diverse subjects. Since arriving at Money Morning in 2011, he has focused primarily on technology. He's an expert on both Apple and cryptocurrencies. He started writing about Apple for The Sun in the mid-1990s, and had an Apple blog on The Sun's web site from 2007-2009. Dave's been writing about Bitcoin since 2011 - long before most people had even heard of it. He even mined it for a short time.
Dave has a BA in English and Mass Communications from Loyola University Maryland.
What a sick world we live in.
Why did you not answer my question ?