Highest CEO pay reported to IRS so far in latest tax year comes from an unlikely group, Society for Human Resource Management
Jan. 7, 2019
Salary increases for the highest-paid CEOs in associations jumped in the latest tax year.
The median combined base-and-bonus increase for the 25 top earners was 6.6 percent, according to in the latest tax disclosures from 2017, which are still rolling in. That’s up from 5 percent in the previous year and the highest median increase in six years.
The largest 2017 paycheck discovered so far by CEO Update researchers went to former Society for Human Resource Management CEO Hank Jackson. His final paycheck was $9.4 million, with $5.7 million attributed to a supplemental executive retirement plan payout. Jackson retired on Dec. 31, 2017, after more than a decade with SHRM, including seven and half years as top executive. Jackson’s 2017 paycheck is the largest recorded by CEO Update since 2013. The lowest salary of the top 25 is the $2.2 million paycheck for Rob Nichols at the American Bankers Association.
Along with severance payments, these types of one-time retirement payouts—the result of deferring salary in earlier years and collecting it later—can propel CEOs to the top-paid list for a single year. However, they are the minority in this year’s top-paid report. Only six of the 25 organizations detail retirement plan or severance payouts for their CEO’s 2017 take-home pay.
Instead, it is incentive pay that continues to play a larger role in the total compensation package offered to the highest-paid association CEOs. Only four of the 25 top-paid CEOs received a bonus that was less than 30 percent of their base pay. The majority of CEOs on this list received a bonus that was at least 50 percent of their base pay, and five CEOs received bonuses equal to or greater than their base pay.
Blue Cross and Blue Shield Association chief Scott Serota’s bonus was three times his base pay. U.S. Chamber of Commerce CEO Tom Donohue saw bonus pay that was five times his base salary in 2017.
At press time, the top-paid list is incomplete and new salary disclosures are expected from Consumer Technology Association, CTIA—The Wireless Association and Financial Services Roundtable, which has since merged into the Bank Policy Institute. All these salaries are expected to be near or more than $2 million.
Those salaries will be included in CEO Update’s next salary report in April 2019, along with the salaries of more than 500 other CEOs who lead national associations with at least $12 million in annual revenue.
These salaries were paid before a new law went into effect that would levy a 21 percent excise tax on nonprofit compensation above $1 million. If the law had been in effect, groups would have been required to pay $14 million in additional taxes for these salaries.