In 2006, life sciences/medical devices CEOs had target bonuses of 95K and realized $69,000 of that. This year, the average CEO’s target bonus is down a bit, to $92,000. The average information technology CEO’s bonus target is $104,000 this year, versus $95,000 in 2006. However, it should be noted that the average IT chief executive last year realized only $57,000 of his or her target, widening the compensation gap with life sciences counterparts.
And now, drum roll please…equity. Equity compensation is also up this year. The average (non-founder) information technology CEO holds a 5.7 percent equity stake, compared to 5.2 percent last year. In life sciences/medical devices, it’s about the same story—a 5.48 percent stake, up from 5 percent last year. Of course, that pales by comparison to founding executives, who in life sciences/medical devices held an average 13.37 percent equity stake. And founding CEOs in IT, held an average 24.79 percent stake.
Here are some other tidbits, in no particular order:
—In life sciences/medical devices, the percentage of executives eligible for bonuses rose from 62 percent in 2006 to 78 percent this year.
—With one exception, all 23 job categories studied showed a solid rise in pay from 2006 to 2007. In life sciences/medical devices, the average base salary rose 5.9 percent. The average year-over-year gain was 4.6 percent in information technology.
—The IT positions showing the biggest salary gain from last year to this were head of human resources and COO, whose base salaries both rose 7.2 percent.
—The only position in either industry category to experience a year-over-year drop in salary was the life sciences/medical devices CTO, whose base pay fell from $183,000 to $179,000 (You gotta wonder about that).
—When looked at by headcount or annual revenues (the revenue breakout was only done for IT), not surprisingly, the bigger the company, the higher the CEO “comp.” The one exception was in the life sciences/medical devices category, where CEOs of firms of 10 or fewer employees made a tad more than those of companies with 11-25 employees ($338,000 vs. $326,000). Other than that, bigger was better.
—When looked at by business segment, the highest CEO compensation was in life sciences (as separated now from medical devices), where the average total compensation package—base salary, plus target bonus—is $394,000 in 2007. At the bottom of the heap was the lowly hardware/semiconductor/electronics CEO, with a package of just $293,000. See the full list just below.
2007 CEO Cash Compensation (base salary and bonus) By Business Segment
Life Sciences—$394,000
IT Services, Consulting, Integration—$392,000
Content, Information Provider—$350,000
Software—$339,000
Medical Devices—$338,000
Communications—$312,000
Hardware, Semiconductors, Electronics—$293,000
Now for the regional data. This is dangerous ground. Aaron Lapat, a managing director at J. Robert Scott, cautions that geography is probably the least statistically relevant of the categories studied. “Everyone thinks that compensation is regional,” he says. In fact, Lapat says there is no consistent trend from year-to-year when it comes to looking at compensation by geography. It’s better to look at compensation by industry segment, revenue, or financing round, he says. So consider yourself warned.
2007 CEO Cash Compensation (base salary and bonus) by Geography
Life Sciences/Medical Devices
West/Midwest—$405,000
California—$373,000
Mid-Atlantic—$366,000
New England—$354,000
South—$315,000
Information Technology
California—$355,000
South—$351,000
New England—$333,000
Mid-Atlantic—$313,000
Midwest—$305,000
West—$301,000
Happy Thanksgiving. Don’t spend all that money on turkeys.
