Hospitality, insurance, utilities executives seeing biggest decreases
Executive compensation packages are being put under a microscope these days and companies are finding it more difficult to offer perquisites and incentives to their companies’ leaders, without facing backlash from the public.
The number of United States companies offering perquisites to CEOs has fallen from 89.8 per cent in 2009 to 61.5 per cent in 2011, according to a survey of 4,500 organizations by Compdata Surveys.
In 2009, 28.3 per cent of companies reported offering company cars to their CEOs. This dropped to 23.5 per cent in 2011. Offering annual physical exams fell from 21.4 per cent to 16.9 per cent over the last two years, compared to voluntary deferred compensation programs which were reported at 21.2 per cent in 2011, down from 24.4 per cent in 2009, found Compdata.
Incentives have also taken a hit, as 61.6 per cent of companies in the West offered long-term incentives to CEOs in 2009, compared to just 19 percent reported in 2011. Organizations in the Southeast offer long-term incentives at a rate of 17.9 per cent, dropping from 58.6 per cent in 2009, found the survey. Only 10.4 per cent of employers in the South Central region of the United States offer long-term incentives to CEOs, down from 47.2 per cent reported in 2009.
Rewards have seen a similar fate, with some of the largest drops seen in the hospitality, insurance and utilities industries. Sixty-five per cent of CEOs in hospitality received bonuses in 2009, decreasing to 40 per cent in 2011. CEOs in insurance receive bonuses at a rate of 53.2 per cent, representing a drop from 62.4 per cent reported two years ago. The rate at which bonuses are offered in utilities fell from 20.9 per cent in 2009 to 12.5 per cent in 2011.
“The impact the recession had on the economy caused many companies to take a hard look at the compensation packages they offer to all employees, and executives were not spared that scrutiny,” said Amy Kaminski, director of marketing at Compdata Surveys. “Though many are optimistic about the country’s economic future, companies may choose to take a guarded approach to offering additional perks and incentives to their top employees, until significant improvements can be seen.”
