Edited by Janeane Davis to add: How much attention do you pay to your salary? Do you compare your salary with your current entrepreneur peer group or to the group you aspire to. Check out the salaries below to see what the highest paid executives in America are making and if you want to join this list, start making plans to have that happen.
Posted by Ben Taylor
The average American makes $50,000 to $70,000 per year. The lowest-compensated person on this list — a breakdown of America’s 25 highest-compensated executives — made $44.3 million in 2014.
To put that in context, the typical American would have to work 738 years straight to match the 2014 compensation for David C. Drummond, Google’s chief legal officer and senior vice president of corporate development.
It might sound like a sensational statistic, but just this past August, the Securities and Exchange Commission voted to reveal this very figure. The SEC will require public companies to report their CEO-to-employee pay ratios, figures that can sometimes be as lopsided as 738-to-1. Needless to say, many corporations aren’t happy about the vote.
The following table breaks down each of the 25 highest-paid executives in America, complete with the year-over-year change in compensation, where available. The data comes from the SEC and is visualized by FindTheCompany.
Topping the list is David M. Zaslav, president and CEO of Discovery Communications. The company owns a variety of television networks, from TLC to Animal Planet to the Discovery Channel. Hired in 2007, Zaslav has helped grow his company’s market cap from $5 billion to $20 billion, an impressive seven-year run in a volatile industry with disruptive advances from Netflix, Hulu and Apple. His reward? A lavish 2014 compensation package totaling $156 million.
Before you grab a pitchfork, keep in mind the distinction between compensation and salary, as well as the rhythm of stock awards and bonuses within the upper echelons of corporate America.
Most of us look at compensation as a steady drumbeat of paychecks: persistent and predictable. In contrast, corporate executives make most of their money from infrequent stock awards, or equity, where the company’s performance in the market means everything.
In Zaslav’s case, about $145 million of the $156 million came from restricted stock and option awards. He isn’t guaranteed any of that money — it all depends on Discovery Communications’ future performance. Once you factor out all bonuses, equity and other compensation, you’re left with $3 million in standard salary.
For this reason, that $156 million figure is a little misleading. The SEC requires companies to report stock awards in the single year that they are granted, but Zaslav’s stock will vest gradually over the course of several years — and that’s only if he stays with the company.
As a case in point, Omid Kordestani — number two on the list — won’t see the lion’s share of his $130 million in 2014 compensation. When Google’s Nikesh Arora left the company for SoftBank in 2014, Kordestani was named the replacement chief business officer, a promotion that earned him that $130 million (mostly in stock). A year later, however, Google eliminated Kordestani’s role as part of the Alphabet split, leaving the executive in a loosely-defined advisor role.
Kordestani has since accepted an executive chairmanship at Twitter. While he’s likely to receive a handsome compensation package from the social media company, he’ll be leaving behind much of his Google stock as a result.
As we move down the list, we see a series of more familiar faces, from Michael T. Fries (CEO of Liberty T. Global, one of the largest broadband Internet providers in the world), Stephen A. Schwarzian (CEO of Blackstone Group, a private equity firm) and Lawrence J. Ellison (former CEO of Oracle). Ellison in particular is notable for appearing on these lists year after year. While many top-tier executives only rank highly in contract years — when they’ve just received a fresh stock bonus — Ellison has been raking in bountiful stock option awards, year after year. (Note that Ellison now serves as executive chairman of the board and chief technology officer at Oracle.)
Continued on page 2. Click 2 below to continue.