100 highest-paid execs in Canada reaping rewards of high inflation
By 9.43 a.m. this morning, Canada’s highest-paying CEOs have already made $58,800 – the equivalent of the average worker’s yearly salary.
That’s according to a new report released by the Canadian Centre for Policy Alternatives (CCPA).
The top 100 highest-paid CEOs now make 243 times more than the average employee. The previous high was 227 times more in 2018.
“We think of inflation as bad for everyone, but for CEOs it’s the gift that keeps on giving,” says CCPA senior economist David Macdonald.
“Historically high profits based on historically high inflation mean historically high bonuses for CEOs.”
In 2009, the best-paid CEOs made, on average, 155 times more than the average worker, according to the CCPA. In 1998, the ratio was 104 times.
“In the span of a quarter century in Canada, CEOs went from making roughly 100 times average workers’ pay to now close to 250 times average workers’ pay,”
In 2022, top CEOs made 191 times more than the average worker.
Variable compensation grows
In addition, in 2008, CEOs’ salary made up 14 per cent of their pay; that’s now down to eight per cent as CEOs increase
their reliance on bonus-type compensation linked to profits and revenue.
In 2021, the highest paid Canadian CEOs took home an average of $14.3 million, according to the CCPA, with bonuses making up 83% of that compensation.
In 2008, variable compensation made up less than 70 per cent of the best-paid 100 CEOs’ total compensation.
“When times are bad, like during the pandemic, CEO bonus formulas are altered to protect them; in good times, like 2021, the champagne never runs dry,” says Macdonald.
An earlier U.K study found that the myth of the “superstar CEO” continues to drive excessive pay, as companies are desperate to attract and retain top talent — even if it doesn’t always lead to improved corporate performance and they have other options.
And the minimum pay to get on CCPA’s top 100 list also hit a new all-time high of $6.7 million in 2021, up from $6.1 million in 2020. This minimum wage for the top CEOs is more than double where it stood in 2008.
