The Wall Street Journal – Independent Boards Offer CEOs Lower Pay

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The Wall Street Journal – Independent Boards Offer CEOs Lower Pay

What does chief executives pay depend on, asks The Wall Street Journal? The crucial factor is the board chairman, reports the US financial daily. Studies suggest that CEOs reporting to a board run by an independent chairman tend to take home around 20% less than their peers. CEOs at companies with an inside chairman enjoy higher earnings based on the belief that “they bring greater shareholder returns,” explains George Davis Jr., global CEO practice leader at Egon Zehnder. But he expects the gap between pay for CEOs with and without independent chairmen to narrow in the future as more companies split the top two roles.

Full story: Theo Francis and Joann S. Lublin: CEO Pay Depends on Board’s Independence in The Wall Street Journal (9 March 2016).