The corporate world is synonymous with extraordinary talent, visionary leadership, and innovative products and solutions. The chief executive officers (CEOs) who navigate their organizations towards unparalleled growth are often the topic of public conversation, particularly when it comes to their compensation. Leading a global giant is no easy task, and CEOs are regularly the beneficiaries of handsome pay packages for their work. Several factors come into play when analyzing CEO compensation, including economic conditions and financial performance, and 2022 was no different.
For 13 years, Equilar has partnered with the Associated Press on annual CEO pay studies. The most recent edition identified trends in compensation awards for CEOs who served in that role at an S&P 500 company for at least two years as of fiscal year end 2022. Companies must have filed a proxy between January 1 and May 1, 2023 to be included in this study.
CEO Pay Increased Incrementally in 2022
While the markets closed at record levels in 2021, such was not the case in 2022. The year began strong, but supply chain issues and inflation dominated through most of 2022 and posed many challenges to companies. The impacts of the economy were indeed reflected in CEO pay. The median total compensation* for S&P 500 CEOs was $14.8 million in 2022—an increase of just 0.9% from the prior year. This marks the smallest year-over-year increase for S&P 500 CEOs since 2015, when pay saw a slight uptick of 0.8%, and a far cry from last year’s study when pay saw a record increase. The largest decline across all pay components was seen in annual bonuses, which dropped in value by 15.5% from $2.7 million in 2021 to $2.3 million in 2022—companies were less willing to pay a premium cash bonus as returns in the market were bleak.
As part of new SEC Pay Versus Performance (PvP) rules, 2023 is the first year that companies are required to disclose both tabular and narrative information reflecting the relationship between compensation actually paid (CAP) to a company’s named executive officers (NEOs) and the company’s financial performance. The goal of the new CAP value is to capture the change in value of previously granted awards. According to the study, the median CAP value for 2022 was $10.5 million for S&P 500 CEOs**—which is significantly less than the median 2021 CAP value of $26.8 million for the same group of executives.
Nevertheless, the highest-paid CEO in 2022 was Sundar Pichai of Alphabet, who was awarded a total pay package of nearly $226 million. Pichai was one of two CEOs to earn a nine-figure pay package—Michael Rapino of Live Nation Entertainment received the other at approximately $139 million. The top 10 highest-paid CEOs from 2022 are featured below.
|Company Name||Executive||2022 Total Compensation||2022 CAP|
|Alphabet Inc.||Sundar Pichai||$225,985,145||$115,820,786|
|Live Nation Entertainment, Inc.||Michael Rapino||$139,005,565||$35,618,299|
|Apple Inc.||Timothy D. Cook||$99,420,097||N/A|
|Broadcom Inc.||Hock E. Tan||$60,606,971||N/A|
|Ingersoll Rand Inc.||Vicente Reynal||$54,505,957||$51,229,750|
|Netflix, Inc.||Reed Hastings||$51,073,237||$51,073,237|
|Netflix, Inc.||Theodore A. Sarandos||$50,299,296||$50,299,296|
|Prologis, Inc.||Hamid R. Moghadam||$48,152,756||-$8,171,362|
|American Express Company||Stephen J. Squeri||$48,026,238||$42,946,184|
|Morgan Stanley||James P. Gorman||$39,398,905||$31,379,534|
Median Employees Saw a Larger Increase in Pay Than CEOs
In 2022, the median S&P 500 employee earned $77,178, up 1.3% from $76,160 the previous year. While the pay increase is minimal, this—in combination with the even smaller increase in CEO pay—drove the CEO Pay Ratio down to 186:1 in 2022, a 2.1% decrease from 190:1 in 2021. While the debate around the CEO Pay Ratio continues to draw the ire of the public, the decreased value of the ratio may be a welcoming sign to advocates against large executive pay packages.
Women Are Underrepresented and Outearned
With 343 executives in this year’s study, just 20 are women. However, this is two more than last year’s study and four more than from the study two years ago. Over the last several years, despite being underrepresented, women outearned men. In 2022, the trend shifted as male CEOs were awarded $14.8 million at the median—1% more than women, whose median pay was $14.7 million. This marked the first time since 2015 that male S&P 500 CEOs outearned their female counterparts. The highest-paid woman on this year’s list was Lisa T. Su of Advanced Micro Devices with a pay package totaling $30.2 million in 2022. This marks the fourth consecutive year that Su is the highest-paid woman in the study. The full list of women CEOs can be found in the table below.
|Company Name||Executive||2022 Total Compensation||2022 CAP|
|Advanced Micro Devices, Inc.||Lisa T. Su||$30,219,921||-$160,142,075|
|General Motors Company||Mary T. Barra||$28,979,570||-$16,991,516|
|Nasdaq, Inc.||Adena T. Friedman||$28,045,305||$25,888,844|
|General Dynamics Corporation||Phebe N. Novakovic||$21,478,167||$48,677,670|
|Duke Energy Corporation||Lynn J. Good||$21,008,835||$24,000,880|
|Elevance Health, Inc.||Gail Koziara Boudreaux||$20,931,081||$35,256,056|
|Northrop Grumman Corporation||Kathy J. Warden||$20,672,072||$54,746,734|
|United Parcel Service, Inc.||Carol B. Tomé||$18,965,201||$13,072,062|
|Vertex Pharmaceuticals Incorporated||Reshma Kewalramani||$15,864,497||$29,529,089|
|Occidental Petroleum Corporation||Vicki A. Hollub||$14,872,965||$59,216,041|
|Otis Worldwide Corporation||Judith Fran Marks||$14,477,875||$15,281,897|
|Ventas, Inc.||Debra A. Cafaro||$14,059,092||$17,813,641|
|Zoetis Inc.||Kristin C. Peck||$14,003,540||-$15,709,790|
|The Hershey Company||Michele G. Buck||$13,550,049||$26,043,523|
|The Progressive Corporation||Susan Patricia Griffith||$12,748,826||$48,474,661|
|Ross Stores, Inc.||Barbara Rentler||$11,335,069||$11,165,315|
|CDW Corporation||Christine A. Leahy||$11,115,822||$8,181,554|
|Celanese Corporation||Lori J. Ryerkerk||$10,967,783||-$8,923,734|
|Arista Networks, Inc.||Jayshree V. Ullal||$10,735,887||$3,171,085|
|Regency Centers Corporation||Lisa Palmer||$8,649,788||$6,276,760|
Communication Services Once Again Tops All Industries
For the fourth consecutive year, communication services saw the highest median total compensation across all industries at $28.1 million in 2022. Consumer cyclical was second on the list at $16.2 million, followed by technology at $16.2 million. Meanwhile, S&P 500 CEOs in the utilities industry saw the lowest median total compensation at $11.3 million. The financial services featured the most CEOs on the list with 55.
|Industry||Number of CEOs||Median Total Compensation|
CEOs in the Hoosier State Boast the Largest Pay Packages
For the last several years, New York had been home to the largest S&P 500 CEO pay packages. In 2022, Indiana took the title and topped the list of states with at least five CEOs, boasting a median pay package of $20.9 million. Virginia was second on the list, as CEOs in the state were awarded $20.7 million at the median. New York fell to third on the list with median CEO total compensation at $19 million.
Once again, California had the highest prevalence of CEOs among all states in 2022 at 47, followed by New York 34. Texas (33), Illinois (27) and Pennsylvania (18) round out the top five.
*Total compensation includes information disclosed in company proxy statements including salary, bonus, stock and options valued at grant date, any deferred compensation, and other compensation (including benefits and perks).
**CAP figures are inclusive of only those companies with fiscal years ending on or after December 16, 2022.
Sr. Director of Content & Communications at Equilar
Amit Batish, Sr. Director of Content & Communications at Equilar, authored this post. Courtny Yu, Director of Research, conducted the data and analysis for this study. Please contact Amit Batish at email@example.com for more information or commentary on Equilar research and data analysis.