In its most recent Executive Quiz inquiring about CEO compensation, Korn/Ferry International reports a significant increase in the number of executives who are concerned about the amount of pay going to their CEOs. The survey showed that 34% of the executives said they have at least some concerns. Just one year earlier, 21% felt their CEO was overpaid.
Who should decide the amount of CEO pay was also a source of concern, according to the survey. Eighty percent of the executives said they believe that shareholders should have at least some say in how much the CEO is compensated. This may have been precipitated by concerns about increasing pay for CEOs and decreasing share prices.
"The tumultuous economic environment highlights the challenges with getting pay for performance right," said Russell Miller, managing director of Korn/Ferry's Executive Compensation Advisors. "The business community continues to focus on aligning pay and performance, and companies are having mixed success against this objective."
About 55% of the queried executives reported that they believe their CEO's pay does not reflect or only somewhat reflects the performance of the company. Forty-two percent believe the CEO's compensation and company performance are in alignment. Complete results are available at www.kornferry.com.