View Full Version : Top CEOs need just 12 hours to earn average Canadian annual salary

01-03-2009, 12:36 PM
Top CEOs need just 12 hours to earn average Canadian annual salary
2009-01-01 18:49:00

TORONTO - As many Canadians nurse their post-New Year's Eve hangovers and ponder what further economic storms await, Canada's top corporate executives can take some comfort in knowing they have already earned as much as the average worker will earn in all of 2009.

A new analysis by the left-leaning Canadian Centre for Policy Alternatives concludes the country's richest corporate executives will have pocketed an average of $40,237 by 9:04 a.m. Friday morning.

"By the time your computer has finished booting up on your first day back after the New Year's holiday, the average CEO would have already banked what took the average Canadian worker an entire year's worth of work to earn," the report states.

"Many of the top 100 include Canada's big bank CEOs, who recently received billions in federal government bailout money to purchase mortgage loans."

Prepared by economist Hugh Mackenzie, the report finds the top 100 CEOs of publicly traded corporations averaged more than $10 million in pay apiece in 2007, the last full year for which figures are available.

That kind of money would buy 44 high-end Porsches or five $2-million condos.

The collective billion-dollar bonanza - a 22 per cent increase over the year before - set a record and followed a decade of unprecedented pay increases, the analysis finds.

Roger Martin, dean of the Rotman School of Management, said the gap between low-end and highest-end earners began growing in earnest in the 1980s and accelerated in the 1990s, something Martin attributed essentially to greed.

The question for CEOs changed from how much they felt they needed to earn to how much could they could "possibly extract" from their companies, an attitude detrimental to the company and their employees.

"Rank-and-file employees will increasingly feel like, 'Wow, I'm working hard to make that guy really, really rich. Do I like that?"' Martin said.

The report is based on disclosures made by companies trading on the Toronto Stock Exchange. The compensation includes salaries, bonuses, proceeds from stock options and other payouts.

The top earner, according to the report, was Michael Lazaridis, head of BlackBerry maker Research In Motion based in Waterloo, Ont., who pocketed more than $51 million.

Martin said current ways of thinking about CEO compensation are "just dead wrong."

"A lot of the CEOs have a compensation formula that still compensates them wonderfully while they're not creating value or even destroying value - laying off people and the like," Martin said.

Incentives they are offered tend to encourage unhealthy and even disastrous risk-taking as senior executives seek to maximize their own earnings, often at the expense of shareholder interests, Martin said.

Despite the market meltdown and hammering of the economy that is costing thousands of workers their jobs, Mackenzie said CEO earnings for 2008 could be as high as they ever were.

"In a rational world, you would expect a big drop in executive compensation in 2008 and again this year," Mackenzie said in an interview.

But in a rational world, he said, one wouldn't expect to see the average pay of the top 50 executives rising from 104 times the average income in 1995 to almost 400 times.

Martin said CEOs should suffer along with employees and shareholders when times are tough.

Repercussions from the economic crisis may yet force them to do so.

The report notes a backlash in the United States against huge salaries and severance packages paid to executives even as their company share prices and performance plummet.

"It's only a matter of time before this new reality takes root in Canada," the report says.


Some facts about the top 100 Canadian CEO earnings

TORONTO - An analysis out Friday by the Canadian Centre for Policy Alternatives finds top earnings for Canada's top 100 CEOs have soared in recent years. Some facts (figures based on 2007 unless otherwise noted):

-Average annual CEO earnings: $10,408,054

-Increase over previous year: 22 per cent

-Average annual pay for Canadians: $40,237

-Number of CEOs to earn total income of Nunavut: 25

-Point at which CEO earns annual salary of average Canadian: Jan. 2, 9:04 a.m.

Quote: "A lot of the CEOs have a compensation formula that still compensates them wonderfully while they're not creating value or even destroying value - laying off people and the like." - Roger Martin, dean of Rotman School of Management.

Source: Canadian Centre for Policy Alternatives

01-03-2009, 04:19 PM
Methinks the goal of all CEOs for next year is to have made the average Joe's salary by 12:01 AM New Year's Day...

If the economy keeps going this way, they just might make it...

Franc (penguinzee)

01-22-2010, 05:55 PM
Top CEOs still raking it in
Projects & Initiatives: Growing Gap
January 4, 2010

Canadians may have been hit hard by a worldwide economic recession, but it appears Canada’s 100 highest paid CEOs are enjoying a soft landing.

Hugh Mackenzie's latest report on executive compensation (http://www.policyalternatives.ca/publications/reports/soft-landing) shows the total average compensation for Canada's 100 highest paid CEOs was $7,300,884 in 2008—a stark contrast from the total average Canadian income of $42,305. They pocketed what takes Canadians earning an average income an entire year to make by 1:06 pm January 4—the first working day of the year.

Click here (http://www.policyalternatives.ca/publications/reports/soft-landing) to read more and download the full report. Click here (http://www.policyalternatives.ca/multimedia/ceo-salary-calculator)to use our CEO pay calculator to find out how quickly a top CEO will earn your salary.


01-23-2010, 02:40 PM
I always love these article that attempt to stir class warfare.

OK, so we restrict CEO salaries to 10x or 100x (whatever) of the average worker.

Why don't we go ahead and restrict the average worker's salary to 10x or 100x of the average worldwide worker's salary?

Hell no!. That isn't what we meant!

How about we have an UN tax of "excessive pay" on ALL workers in the western world for distribution to those workers in developing countries?

After all THEY are the ones that make the items we buy on US store shelves.

Hell no! That isn't what we meant!

01-23-2010, 05:56 PM
Pote, they already have all of what you have written planned.

Just waiting for the right crisis to implement it.


01-23-2010, 06:34 PM
Banner Year for Canada's CEOs
Jan 7 2009

Canada’s richest CEOs pocket the average Canadian wage of $40,237 by 9:04 a.m. January 2nd – before most Canadians have
booted up their computer for another year of work,” says Canadian Centre for Policy Alternatives (CCPA) Research Associate Hugh

The CCPA released a report on January 2, 2009 (http://www.cawcouncil4000.com/09jan07_banner_year_for_ceos.pdf) showing that the 100 highest paid CEO's at publicly traded corporations in Canada
earned an average of $10.4 million in total compensation in 2007, which was an average increase of 22%, from its $8.5 million
average in 2006.

This compared with an average pay hike of only 3.2% to $40,237 for the average Canadian worker during 2007.
"Compared with ordinary Canadians, whose wages have been stagnant for 30 years, Canada's economic downturn promises to hit the masses far harder than the best paid 100 CEOs," Mackenzie said. "They have enjoyed a decade of record pay hikes and will land on a softer cushion if they stumble from their lofty heights in the New Year."

The wage gap between the average Canadian worker and CEOs has been growing steadily over the past decade. In 2007, Canada's top 50 CEOs earned 398 times more than the average worker, compared with 85 times in 1995.

MacKenzie said that between 1998 and 2007 the average compensation of top CEOs increased by 147%, adjusted for inflation. This compared with a 3% decline in inflation-adjusted weekly wages for average Canadians and a 6% rise for those on the minimum

Bonuses and salaries paid to Canadian chief executives are expected to come under increased scrutiny in 2009 from shareholders who have been burned by the decline in stock prices and as mounting pressure to slash CEO pay in the United States spills over into Canada.

CEO pay in Canada has so far not come under as intense a spotlight as in the United States, but MacKenzie of the CCPA says that Canadian shareholders are likely to take a closer look at the issue when companies hold their annual general meetings this year amid a contracting domestic economy.

"To the extent that the meltdown in the market and the reaction to it in the United States creates new trends in compensation, those trends will leak over to Canada," said MacKenzie.

President & CEO pay at CN

Look specifically at the pay increases to the position of CEO at CN, Canada’s largest railway and the employer of the majority of our CAW Council 4000 membership.

While Canadian National was still a Federal Crown Corporation in 1992, the year that Paul Tellier was appointed president of CN by then Prime Minister Brian Mulroney (many labelled it a “patronage appointment”), the corporation’s president - which was the equivalent of today’s CEO position - earned an annual salary of $345,000 plus expenses. For Tellier, that was more than twice the $165,000 annually he received as a public servant.

CN allegedly gave its new president, Paul Tellier, a $432,000 interest-free loan to buy a house, of which $300,000 came from CN and $132,000 from SRS or Supplemental Retirement Security. The loan was not guaranteed by a mortgage so that the deal would not have to be made public. In return, the president signed an interim note and increased his individual life insurance by $300,000
payable to CN to guarantee his loan. Worse yet, while a $432,000 loan was allegedly made, the house was only assessed at $283,000.

Tellier, who worked in government for more than a quarter of a century, immediately turned to privatize CN, a goal that was ultimately reached in 1995. He knew that the benefits would be.

After the Federal Liberal government and Parliament allowed CN to become a private, publically traded company in 1995, Paul Tellier, his titled now changed from president to Chief Executive Officer (CEO) of CN; saw his pay and benefits rise dramatically.
From 1995 to 1997, Paul Tellier's salary and bonuses grew by 108 percent, despite the fact that CN's profits (before special charges) grew by just 17 percent! By the end of 1997, Paul Tellier owned 113,800 stock options (granted as part of his overall compensation package), which at the time were worth $7.7 million dollars, and received salary and bonuses totalling $1.3 million (which excludes the value of his stock options). This was the equivalent to the earnings of over 30 average CN workers. During the three years since CN was privatized, Paul Tellier received total salary and bonuses of some $2.8 million.

But the pay for the CEO of CN has only gotten better over the next ten years. As of 2007, current CN CEO E. Hunter Harrison made a base salary of $1, 719, 650.00 and an overall total compensation of $13,322,045.00 and was ranked as the 24th highest paid CEO on the ‘Top 100 list of CEO pay’ (http://www.cawcouncil4000.com/09jan07_banner_year_for_ceos.pdf)for Canadian based companies.

Click here to view the report by Hugh Mackenzie of the CCPA

Source: CCPA and files of CAW-Canada, CAW Economist Jim Stanford and the Hansard Index


01-26-2010, 05:49 AM
Pote, they already have all of what you have written planned.

Just waiting for the right crisis to implement it.

:beer:The crisis came and the conversion is in action. Wait till we see figures for just the current wage and benefit (like healthcare) reductions.