Report: CEO Salaries Declining, Bonuses Remain Secure
Median CEO pay has reached its lowest point in a decade, according to a recent survey by the Australian Council of Superannuation Investors (ACSI). However, bonus payouts for executives remain high, with Australia’s highest-paid CEO taking home over $27 million last year.
The study focuses on “realized pay” rather than “reported pay,” providing a more accurate reflection of financial outcomes. The data shows a slight decrease in CEO incomes, with median pay dropping from $3.93 million to $3.87 million for the top 100 ASX companies, the lowest in the 10-year history of the study.
Even though salaries have fallen, bonus payments have become standard practice, with only two CEOs not receiving a significant bonus. The survey suggests that boards should set performance hurdles at appropriate levels to ensure bonuses are tied to exceptional outcomes.
Despite the decrease in median pay, some CEOs received substantial bonuses. Macquarie Group CEO Shemara Wikramanayake received the highest bonus of $32 million, marking the first time the maximum bonus surpassed $20 million. The study also reveals that bonuses have remained consistently high, with 70 out of 75 ASX100 CEOs eligible for bonuses in FY23.
The study indicates a possible upward trajectory in CEO pay levels in the future, prompting concerns about the need for closer board oversight and setting appropriate performance benchmarks for bonus payouts.
