In Pay, Some CEOs Are More Equal Than Others

Last Updated Oct 20, 2008 8:08 PM EDT

As the pigs in George Orwell's "Animal Farm" demonstrate, the maxim holds that "all animals are equal, but some animals are more equal than others."

Substitute CEOs for swine and you'll see a trend in executive compensation.

CEOs at the largest companies got pay hikes that were three to four times higher than CEOs at the smallest firms, according to a recent remuneration study by The Corporate Library.
From 2006 to 2007, CEOs from Standard & Poor's 500 firms got pay raises (total actual compensation) at rates of 22 percent. Mid-sized firm CEOs saw similar pay hikes of 15 percent while the little guys from small cap firms got only 5.5 percent pay hikes. The study examined 3,242 firms in the U.S. and Canada last year. Median actual compensation was about $2 million although some marquee name executives earned compensation many times that.

One could argue that top executive at large companies have more responsibilities than those at smaller firms, but small firm CEOs often don't have thickly-layered bureaucracies to help them out and likely have to perform more tasks themselves.

One irony is that the CEOs did so well with paychecks and other forms of compensation last year when 2007 wasn't all that good for business, suggesting there's not much link between pay and performance.