Pay Freeze Continues for Majority of Finance Executives
- For Minority Receiving Salary Boosts, Average Percentage Increase Has Dropped -
- Reduction in Finance and Accounting Staff over Past Four Years -
Reflective of the past year's economic woes, a majority of financial professionals are still not receiving salary increases, revealed findings from a survey released today and conducted by Financial Executives Research Foundation (FERF). While many executives are however still reporting bonus awards, increases to average base salaries that were awarded during the past year were significantly less than those awarded in the previous year. The profession has also fallen victim to job cuts, with respondents indicating a drop in finance staff, compared to the past four years of the survey.
The Financial Executive Compensation Survey, now in its fourth year, provides a year-to-year comparison of compensation for finance professionals. The study examines salaries, bonuses, long-term incentives and retirement benefits of more than 1,100 financial executives from both public and private companies, nearly half of which were CFOs.
Private company finance functions reported much more stability than their public company counterparts in terms of staff levels. An additional shift in compensation was evident when salary increases between private and public companies were compared. While traditionally public companies have awarded higher salary increases, the average salary increase for public and private companies was identical for the first time in the four years this survey has been conducted.
Salary & Bonuses
The estimated average base salary increase of all respondents is 2.1 percent - a further decrease from 2009's low of 3.7 percent. More than half of all respondents (57%) stated that they did not receive a salary increase in 2010. While salary increases were the exception, virtually all public and private company CFOs (96 %) reported receiving a bonus this year. The amount of respondents who received an additional cash-based long-term incentive award increased for the first time in the four years the survey has been conducted. For the fourth year in a row, the base salaries of public and private company CFOs remained proportionate to companies' annual revenues.
- Public company CFOs: For public company CFOs, the average base salary for 2010 is $285,000, a decrease from the prior year's survey ($296,800).
- After factoring in bonuses and long-term cash incentives, the average total cash compensation is $480,877.
- Adding stock-based compensation, retirement and perquisites, the average total compensation is $680,407.
- Bonuses for public company CFOs vary across the board.
- While a fraction reported no bonus, about eight percent of respondents reported a bonus that exceeds 100 percent of their base salary.
- Private company CFOs: For private company CFOs, the average base salary for 2010 is $204,800, an increase from the prior year's survey ($199,600).
- After factoring in bonuses and long-term cash incentives, the average total cash compensation is $285,044.
- Adding stock-based compensation, retirement and perquisites, the average total compensation is $367,311.
- Bonuses for private company CFOs also varied across the board.
The full press release is available on the FEI press room webpage.
Detailed figures for base salary, bonuses, long-term and stock-based compensation, retirement benefits and perquisites are available online through PayCheck, FEI's online search tool. Responses can be searched based on all criteria, including title, company type and company size.