The 20 Highest Paid CEOs in America

By Todd Shriber,

Shutterstock photo

It's good to be king, particularly in corporate America. When we take a look at the 20 highest paid chief executive officers, we find familiar names, some names not as well-known, some whose pay is justified by increased shareholder value and some with pay packages that will make your blood boil. 

The CEOs on our list are widely spread among a variety of industries, including: Technology (3), Media (3), Financial Services (3), Pharmaceuticals/Healthcare (3), Defense (3), Energy (2), Automotive (1), Consumer Staples (1) and Telecommunications (1).

Of the 20 companies with high-earning CEOs, 18 are listed on the NYSE and 2 are listed on the Nasdaq. Only eight are Dow component companies (to get the full list of Dow components, click here). No women made the list in 2009. 

Starting at the top, here are the 20 highest paid executives in America:

Larry Ellison, Oracle (Nasdaq: ORCL)
2009 Total Compensation: $84.5 million

Ellison is usually somewhere toward the top of this list in any given year. Being critical of Ellison's pay is difficult for a couple of reasons. First, he founded Oracle, so this is his ship. Second, the performance of the stock seems to justify the pay -- Oracle was up more than +33% in 2009 and has returned almost +10,000% since going public in 1988.

[Ellison doesn't just make a ton of money; he also gives away a ton of money. See what Ellison can teach you about being a billionaire in one of the month's most popular articles, 3 Billionaire Habits for Non-Billionaires .] 

Ray Elliott, Boston Scientific ( BSX )
2009 Total Compensation: $33.4 million

Elliott took the helm at Boston Scientific in July 2009, so one could argue he needs more time to get the medical device maker headed in the right direction. But detractors will tell you that $33 million is far too much to pay the CEO of a company whose shares have lost more than -50% in the past year and now trade for around $5.

Ray Irani, Occidental Petroleum ( OXY )
2009 Total Compensation: $31.4 million

Bigger isn't always better in terms of executive pay in the oil patch. Irani regularly appears near the top of this list despite the fact that Occidental is just the fourth-largest U.S. oil company. Irani and Occidental have both come under fire lately from shareholders concerned about executive pay and lack of a clear succession plan. But, Irani has been CEO of Occidental since 1990, and in that time its stock is up more than +400%.

Mark Hurd, Hewlett Packard ( HPQ )
2009 Total Compensation: $24.2 million

Hurd is the former CEO of the world's largest personal computer maker following a scandal involving his inability to properly fill out expense reports. In addition to pay, Hurd was lavishly compensated in other ways. He had access to the company jet and HP shareholders even paid for his personal financial advisor. Yes, HP stock almost doubled in Hurd's five-year tenure, but shares are down -18.5% in the past two years, making it difficult to justify the recent size of Hurd's deal. 

James Hackett, Anadarko Petroleum ( APC )
2009 Total Compensation: $23.5 million

Hackett deserves credit for transforming Anadarko from a sleepy oil and gas producer to a major player on the global energy stage. The company doesn't just do business in the U.S.; it has exposure to exotic markets all over the world, and Hackett has overseen that transformation. He took over as CEO in December 2003, and despite the punishment Anadarko shares have endured recently for the company's exposure to the Gulf of Mexico oil spill, the stock has doubled from January 2004 through today. 

A.G. Lafley, Procter & Gamble ( PG )
2009 Total Compensation: $23.5 million

Lafley retired in February, which may be a relief to P&G shareholders. He earned $71 million during the past three years while the stock barely moved. Yes, the dividend was raised on Lafley's watch, but P&G has raised its dividend annually for more than 50 consecutive years, so Lafley doesn't deserve credit for that. In my opinion, this has been an example of too much pay for too little performance.

William Weldon, Johnson & Johnson ( JNJ )
2009 Total Compensation: $22.8 Million

Like P&G, Johnson & Johnson is another prodigious dividend raiser. They've been raising payouts for so long that it almost doesn't matter who the CEO is because that person wouldn't want to be the one who ends the streak. Weldon hass been at the helm since 2002 and has presided over J&J's dismal 5-year return of -10%. 

Miles White, Abbott Labs ( ABT )
Total 2009 Compensation: $21.9 Million

At least we can say Miles White delivers more for his shareholders than William Weldon does for his. Abbott is up +10% in five years. White is the longest tenured Big Pharma CEO and he has a tricky gauntlet to run as profitable patents like that for its blockbuster drug Depakote expire. This is when we'll see if his big pay benefits shareholders.

Bob Iger, Walt Disney ( DIS )
2009 Total Compensation: $21.6 million

It's hard to argue with this one. Iger has led Disney to a +20% gain in the past year, quadruple the Dow's performance. Not only that, but Iger has been instrumental in restoring investor confidence in Disney. The stock is up about +30% in the past five years, but compared to the flat Dow, Iger looks pretty deserving of his pay.

Samuel Palmisano, IBM ( IBM )
2009 Total Compensation: $21.2 Million

IBM is up only +5% in the past year and shareholders have been grumbling that the company could commit more cash to its dividend than it does. IBM did just take advantage of ridiculously low interest rates to raise $1.5 billion in bonds, so maybe some of that money will find its way back to shareholders in the form of dividends or share buybacks. 

[A recent InvestingAnswers article from former IBM analyst and current income investing expert, Amy Calistri, looks at whether IBM's financing indicates that interest rates have bottomed. Read more here: One of America's Largest Companies Flashes a Warning Sign for Income Investors .]

Robert Stevens, Lockheed Martin ( LMT )
2009 Total Compensation $20.5 Million

This one is tricky. In the past year, rival Boeing ( BA ) has sharply outperformed Lockheed (+23.8% vs. -3.6%). But if we look at a five-year history (Stevens has run the show at Lockheed for six years), Lockheed's +17.4% return handily beats Boeing's -3.4%. 

Randall Stephenson, AT&T ( T )
2009 Total Compensation: $20.3 million

AT&T shares are essentially flat in the past year, but this is one of the more predictable blue chips out there. AT&T takes its dividend seriously and in a volatile market environment a CEO that provides stable growth and a solid dividend is worth rewarding.

Jay Fishman, Travelers Companies ( TRV )
2009 Total Compensation: $20.1 million

Give Fishman credit: The financial crisis severely punished big insurance companies, but Travelers never suffered in the same way as American International Group ( AIG ) or Hartford Financial ( HIG ). Outperforming your rivals is key to commanding big-time paydays and Fishman has done just that.

Jeffrey Bewkes, Time Warner ( TWX )
2009 Total Compensation: $19.4 million

Considering the discrepancy in their respective stocks' performance, the difference between Bewkes and Iger's pay at Disney may not be big enough. Time Warner has trailed Disney in terms of stock appreciation by so much (+7.0% vs. +20%) that it can be argued that the $2.2 million gap between Bewkes and Iger isn't nearly enough.

John Stumpf, Wells Fargo ( WFC )
2009 Total Compensation: $18.8 million

Considering that Wells Fargo has been a solid performer under Stumpf's leadership and that the stock was one of many financials that rallied off the March 2009 market lows, Stumpf's big pay-day can be given a pass for now. But investors will be looking for the dividend to be restored soon, so that some of that big money can be funneled into their pockets instead of Stumpf's.

James Cracchiolo, Ameriprise Financial ( AMP )
Total 2009 Compensation: $18.2 million

Ameriprise tripled off its March 2009 low, so we'll give our seal of approval to Cracchiolo's pay and performance. The market was certainly favorable to financials for much of 2009, but a triple in 18 months is still pretty impressive.

Rupert Murdoch, News Corp. (Nasdaq: NWSA)
Total 2009 Compensation: $18 million

Murdoch built News Corp, and it's hard to think of anyone who would get in the way of a man being paid by his own company. But in all fairness, News Corp stock almost doubled in 2009, even taking into account a tough media and advertising environment. A pretty impressive performance.

Ronald Sugar, Northrup Grumman ( NOC )
Total 2009 Compensation: $17.9 million

Considering how sharply Northrup Grumman has outperformed Lockheed Martin in the past 52 weeks (+13.5% vs. -3.6%), it might be fair to say Sugar was underpaid compared to Stevens. Even so, the point is moot: Sugar stepped down as CEO and chairman at the end of 2009 and officially retired in June 2010. 

Alan Mulally, Ford Motor ( F )
Total 2009 Compensation: $17.9 million

We'll make this one short and sweet: Given Ford's dramatic turnaround in both operating and share price performance under Mulally's stewardship, it can certainly be argued that this man is underpaid. 

Louis Chenevert, United Technologies ( UTX )
Total 2009 Compensation: $17.9 million

United Technologies has been one of the better performing industrial conglomerates over the past year +11.6% and the stock has outperformed the Dow, its home index . Blue chips across the board have largely lagged United Technologies, so the money spent on this CEO seems well worth it.

If you'd like to read about how some of the richest people in the world invest their money, click here to see one of InvestingAnswers' most popular articles of the month, 5 Astonishing Billionaire Portfolios .


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Personal Finance , Business

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