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Source: Harvard Law
Published: September 2018
n = ~400 companies

An Increase in CEO Pay

Circulated: July 8, 2020

For the period 1990 through 2016, median CEO pay at large US companies grew by over 400%. Researchers found the following factors to have contributed to this:

  • Public disclosure of CEO pay: the creation of the SEC in 1934 made the disclosure of executive compensation mandatory for all publicly traded firms. By comparing pay, CEOs pressured companies to pay more.
  • Growth in company size: as companies got bigger, so did CEO pay. For a 10% increase in company size, CEO pay goes up by 3%.
  • CEO turnovers: the median CEO tenure in 2017 was 5.0 years (down from 6.0 years in 2013). Incoming CEOs are paid more, on average, than the departing CEO.

Median CEO Pay at Large US Companies

Year $ Millions Change from 1990
1990 $2.2 0%
2000 $9.4 317%
2010 $9.9 341%
2016 $12.1 438%
2020 (Projected) $13.8 514%

Note: Dollar amounts shown in the chart were adjusted for inflation, reflecting 2018 dollars

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