The chief executive officers of Wells Fargo, JPMorgan and Citigroup are among the 100 most overpaid CEOs, according to a new report.
The report from As You Sow, an advocacy group that promotes corporate social responsibility, assesses CEO pay at all S&P 500 firms using data from Institutional Shareholder Services and HIP Investor, which “computes what the pay of the CEO would be, assuming such pay is related to cumulative total shareholder return over the previous five years, using a statistical regression model.”
The advocacy group taps the results to determine the excess pay received by a CEO and includes data ranking firms by the percentage of company shares that voted against the CEO’s compensation. [Scroll down for the full list of the 100 most overpaid CEOs.]
In the wealth management space, the most overpaid CEO by those metrics is Wells Fargo’s Charles Scharf, who earned $20.4 million in 2020, or $7.2 million more than he should have, according to As You Sow, after earning $34.3 million in 2019.
Despite the smaller compensation package, however, Scharf climbed in ranking from 55th in last year’s report to 38th in this year’s.
Meanwhile, JPMorgan’s Jamie Dimon — whose $31.7 million pay package for 2020 included what As You Sow claims was $17.1 million in excess pay — came in at number 62, after coming in at 35 in last year’s report and at number 12 in the 2020 report.
In January, JPMorgan raised Dimon’s pay for 2021 to $34.5 million, as reported.
Citigroup’s former CEO Michael Corbat, who earned $23.0 million in 2020 — about $9.1 million of which was in excess pay, according to the report — came in at number 73. He ranked 76th in last year’s survey for earning $25.5 million.
Citi’s new CEO Jane Frasier, meanwhile, earned $22.5 million for 2021.
Ameriprise’s James Cracchiolo, who earned $20.8 million in 2020 — about $6.1 million too much, according to As You Sow — dropped to number 99 in this year’s list from number 49 in last year’s survey and number 15 in the 2020 report.
And Goldman Sachs’ David Solomon — who came in at number 39 in last year’s report — did not make this year’s list. The company had slashed Solomon’s 2020 pay to $17.5 million — but then doubled it to $35 million for 2021.
The most overpaid CEO, according to the report, was Paycom Software’s Chad Richison, followed by Norwegian Cruise Line’s Frank Del Rio, General Electric’s H. Lawrence Culp Jr., T-Mobile’s G. Michael Sievert and Nike’s John J. Donahoe II.
As You Saw says that there was increased opposition in 2021 to CEO compensation: a record 16 firms had more than half of their shareholders reject CEO pay packages, up 60% from 2020 and more than double from 2019.
“Some boards acted as if pay for performance didn’t matter when Covid-19 was involved, and shareholders angrily rejected those packages. But it is time for more shareholders to vote against the quantum of pay, not just particular bad practices,” Rosanna Landis Weaver, executive compensation program manager at As You Sow and author of the report, said in a statement. “The growth in CEO pay is unjustified and not in the best interests of shareholders.”
Robert Reich, former U.S. Secretary of Labor and co-founder of Inequality Media, said in a statement that CEO pay rose 940% since 1978 — while the typical worker’s compensation inched up only 12%.
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