Top 10 highest paid CEOs in 2016

NEW YORK – The typical CEO at the biggest U.S. companies got an 8.5% raise last year, raking in $11.5 million in salary, stock and other compensation last year, according to a study by executive data firm Equilar for The Associated Press. That’s the biggest raise in three years.

The bump reflects how well stocks have done under these CEOs’ watch. Boards of directors increasingly require that CEOs push their stock price higher to collect their maximum possible payout, and the Standard & Poor’s 500 index returned 12% last year.

Over the last five years, median CEO pay in the survey has jumped by 19.6%, not accounting for inflation. That’s nearly double the 10.9% rise in the typical weekly paycheck for full-time employees across the country.

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But CEO pay did fall for one group of companies last year: those where investors complained the loudest about executive pay. Compensation dropped for nine of the 10 companies scoring the lowest on “Say on Pay” votes, where shareholders give thumbs up or down on top executives’ earnings.

Other measures that would highlight the income gap between CEOs and typical workers are on the way, but governance watchdogs worry that Congress will kill or dilute their strength.

“It’s all out of whack right now,” said Heather Slavkin Corzo, director of the AFL-CIO Office of Investment, which says CEOs for major U.S. companies make 347 times more than the average worker.

CEOs typically got more than half their total compensation from stock and option grants last year.

Here are the 10 highest-paid CEOs for 2016, as calculated by The Associated Press and Equilar, an executive data firm.

1. Thomas Rutledge
Charter Communications Inc.
$98 million
Change from last year: Up 499%

Charter Communications absorbed Time Warner Cable and Bright House Networks last year to become the nation’s second-largest cable operator.

Rutledge’s compensation included $88 million from stock and option awards as part of a new five-year employment agreement. For Rutledge to collect the full amount, Charter’s share price will need to rise 155% over six years.

2. Leslie Moonves
CBS Corp.
$68.6 million
Change: Up 22%

Leslie Moonves’ pay  package included $63.9 million in bonus and stock awards the company’s board said he received for presiding over a 36.6% return for CBS shares in 2016 and for keeping CBS the top-rated network in the 2015-16 season, among other performance measures.

3. Robert Iger
Walt Disney Co.
$41 million
Change: Down 6%

Robert Iger’s $41 million compensation was 6% less than the year before, as slowing growth resulted in a bonus cut.

4. David Zaslav
Discovery Communications Inc.
$37.2 million
Change: Up 15%

Roughly 70% of  David Zaslav’s compensation from Discovery Communications, whose networks include TLC and Animal Plane, was from stock and option awards.

5. Robert Kotick
Activision Blizzard Inc.
$33.1 million
Change: Up 358%

Activision Blizzard’s Robert Kotick’s compensation surged 358% to $33.1 million. That was almost entirely due to $24.9 million in stock awards he received as part of a new five-year employment agreement. To get them, the company’s earnings per share must hit a certain level, among other financial targets.

Kotick may not make the top five in 2017 since his salary was cut 26%  to $1.8 million after many shareholders said they were upset about how much Activision Blizzard executives were making. The company also eliminated his guarantee for an annual salary increase.

6. Brian Roberts
Comcast Corp.
$33 million
Change: Down 9%

7. Jeffrey Bewkes
Time Warner Inc.
$32.6 million
Change: Up 3%

8. Virginia Rometty
IBM
$32.3 million
Change: Up 63%

9. Leonard Schleifer
Regeneron Pharmaceuticals Inc.
$28.3 million
Change: Down 40%

10. Stephen Wynn
Wynn Resorts Ltd.
$28.2 million
Change: Up 36%

How AP and Equilar calculated CEO pay

For its annual study of CEO pay, The Associated Press used data provided by Equilar, an executive data firm.

Equilar examined the regulatory filings detailing the pay packages of 346 executives. Equilar looked at companies in the Standard & Poor’s 500 index that filed proxy statements with federal regulators between Jan. 1 and May 1, 2017. To avoid the distortions caused by sign-on bonuses, the sample includes only CEOs in place for at least two years.

To calculate CEO pay, Equilar adds salary, bonus, perks, stock awards, stock option awards, deferred compensation and other pay components that include benefits and perks.

Stock awards can either be time-based, or performance-based, meaning the CEO has to meet certain goals before getting them. Stock options usually give the CEO the right to buy shares in the future at the price they’re trading at when the options are granted. All are meant to tie the CEO’s pay to the company’s performance.

To determine what stock and option awards are worth, Equilar uses the value of an award on the day it’s granted, as recorded in the proxy statement. For options, this includes an estimate of what the award could be worth in the future. Their actual value in the future can vary widely from what the company estimates.

Equilar calculated that the median CEO pay in 2016 was $11.5 million. That’s the midpoint, meaning half the CEOs made more and half made less.

Here’s a breakdown of 2016 pay compared with 2015 pay. Because the AP looks at median numbers, rather than averages, the components of CEO pay do not add up to the total.

• Base salary: $1.1 million, up 3.3 percent
• Bonus, performance-based cash awards: $2 million, up 7.3 percent
• Perks: $182,841, up 6.2 percent
• Stock awards: $5.5 million, up 11.5 percent
• Option awards: $1.1 million, up 6.4 percent
• Total: $11.5 million, up 8.5 percent