Salaries of the Big Guys
"The total average compensation for Canada's 100 highest paid CEOs was $7,352,895 in 2008—a stark contrast from the total average Canadian income of $42,305." This interesting piece of information is part of a study recently published by the Canadian Centre for Policy Alternatives, entitled A Soft Landing: Recession and Canada's top 100 Highest Paid CEOs.
I've been asked often by clients at the reference desk how they can find information on CEO's salaries themselves. Is it publicly available?
The answer is yes - for public companies. But you have to be willing to do some legwork!
Public companies in Canada and the U.S. are required by law to disclose information about themselves. Canadian public companies currently provide this information through filings posted on the SEDAR website. (SEDAR is the official site that provides access to most public securities documents and information filed by public companies and investment funds with the Canadian Securities Administrators.)
The salary figures can be found in the Management Information Circular of each individual company. For example, here is SEDAR's list of Bombardier's public documents, which includes the Management Information Circular. (You need to complete a code verification to access the document.)
Once in the document you have to dig. But essentially, the information you find will includes base salary, annual incentives, stock options, pension values and all other compensation. Public companies are required to disclose the compensation of their chief executive officer, chief financial officer, and the three other highest paid executives with compensation greater than $150,000.00.
As always though, things are more complicated than they appear! There is more than one document that includes compensation information, and rules about what needs to be disclosed - and how - can change. Read more about some of what is required currently in executive compensation disclosure in Canada.
You can find compensation information for U.S. public companies by looking at the U.S. Security and Exchange Commission's EDGAR database for the particular company's proxy statement.
From the EDGAR website: "In the annual proxy statement, a company must disclose information concerning the amount and type of compensation paid to its chief executive officer, chief financial officer and the three other most highly compensated executive officers. A company also must disclose the criteria used in reaching executive compensation decisions and the degree of the relationship between the company's executive compensation practises and corporate performance."
An example of an Annual Proxy Statement is this one, for Microsoft Corporation, which includes executive compensation information.
If you really want to have some fun, check out Footnoted! From their website:
"Each day, the site takes a closer look at the things that companies try to bury in their routine SEC filings. Some posts are simply quirky little factoids (like the fact that Warren Buffett’s son relies on ConAgra for his health insurance) while others tend to focus on more serious issues, like aggressive accounting, excessive compensation or the type of questionable self dealing that can often be indicative of more serious problems at a company."
Juicy! And a great tool for investors.