CEO: Ronald Hovsepian
Company: IntraLinks Holdings
3-Year-Average "Performance Adjusted Compensation": $8.45 million.
2013 total compensation: $3.4 million
Reason: His "IPO option grant has appreciated in value" says Ferracone.
But the same can't be said for investors that bought stock on IPO day back in 2010. It opened at $13 and now trades below $12 at one point this year hitting as low as $7.76.
CEO: Anders Gustafsson
Company: Zebra Technologies
3-Year-Average "Performance Adjusted Compensation": $15.23 million
2013 total compensation: $4.02 million
Reason: "Equity grants increased in 2013. Performance-based equity award for the 2011 - 2013 performance period vested in 2013 at 180% of target," says Ferracone.
Gustafsson is clearly being rewarded for the gutsy move he made this year when Zebra bought its much bigger competitor Motorola Solutions for $3.45 billion cash.
CEO: Abraham Reichental
Company: 3D Systems
3-Year-Average "Performance Adjusted Compensation": $15.84 million
2013 total compensation: $10.9 million
Reason: 3D systems granted Reichental almost $9.4 million in restricted stock units, double last years and almost six times more than the year before, landing him on this highest paid list.
"Equity grants increased in 2013 over historic norms with significant stock appreciation increasing value of historical grants," says Ferracone.
However, Ferracone points out that 3D Systems has a history of fair pay, so she wouldn't call him "overpaid" based on the one year's compensation.
CEO: David Schlanger
Company: WebMD Health
3-Year-Average "Performance Adjusted Compensation": $18.14 million
2013 total compensation: $7.98 million
Reason: Schlanger was named CEO in mid-2013, but he was a senior executive at the company and its predecessor since 1995.
He landed on the highest paid list because his "2012 option grant has tripled in value to $24MM with increase in stock price," says Ferracone.
CEO: Zach Nelson
Company: NetSuite
3-Year-Average "Performance Adjusted Compensation": $18.42 million
2013 total compensation: $12.5 million
Reason: In 2013, the board granted Nelson $9.77 million in restricted stock (plus more than $1.6 million in stock options), more than double the previous year's grants and five times more RSUs than two years earlier.
"Equity grants increased in 2013 over historic norms with significant stock appreciation increasing value of historical grants," says Ferracone.
CEO: Paul Ricci
Company: Nuance Communications
3-Year-Average "Performance Adjusted Compensation": $31.68 million
2014 total compensation: $17.94 million
Reason: This company is "consistently awarding above-market performance and restricted equity grants," says Ferracone.
The company's stock trades at over $14 with a market cap of $4.62 billion.
CEO: Ronald Clarke
Company: FleetCor Technologies
3-Year-Average "Performance Adjusted Compensation": $40.43 million
2013 total compensation: $32.86 million
Reason: Clarke's "$30 million (grant date value) of performance-based shares have appreciated significantly given stock price increase," says Ferracone, which landed him on our highest paid list.
That is, of course, what performance stock grants are all about. In 2013, the company doubled down and awarded him another $30 million worth of shares.
CEO: Marissa Mayer
Company: Yahoo
3-Year-Average "Performance Adjusted Compensation": $51.70 million
2013 total compensation: $24.94 million
Reason: Mayer's "initial equity grant of $40 million has increased in value," says Ferracone.
And Yahoo intends to continue to pay her handsomely compared to her peers. "Design of 'going forward plan' is significantly higher than market," says Ferracone.
Mayer was granted $35 million in stock when she joined Yahoo and another $13.85 million in stock options in 2013, among other pay.
CEO: Marc Benioff
Company: Salesforce.com
3-Year-Average "Performance Adjusted Compensation": $55.17 million
2014 total compensation: $31.33 million
Reason: "The annual options awards to founder CEO [Marc Benioff] are well above market," says Ferracone.
For instance, Salesforce.com paid him $14.5 million worth of options in 2012, $18.9 million in 2013, $27.7 million in 2014. Meanwhile, Benioff owns just over 7% of the company, more than any other individual person.
CEO: Larry Ellison
Company: Oracle
3-Year-Average "Performance Adjusted Compensation": $123.02 million
2014 total compensation: $67.26 million
Reason: Although Ellison gave up the CEO title in late 2014 to become CTO and executive chairman, Ellison still runs the show at Oracle.
He did take a slight cut in pay for the switch, but he is overpaid by just about any standard. "As the founder CEO, he received annual option grants of $70M (grant date value)," notes Ferracone.
Some of the wealthiest CEOs are actually underpaid — by today's executive pay standards anyway.
They fall into “Farient’s ownership criteria" which means they have a big stake in their companies (typically because they are founders). Those stakes can be worth at least 20 times what they would be paid as a hired-gun CEO.
If they take a big salary and options on top of that (like Marc Benioff and Larry Ellison), they could be considered overpaid. If they don't, they might actually be "underpaid" comparatively speaking.
With that explanation, click on to see the list of lowest paid CEOs ...
CEO: Satya Nadella
Company: Microsoft
3-Year-Average "Performance Adjusted Compensation": $1.42 million
2013 total compensation: $7.67 million
Reason: Nadella is a long-time employee, so Ferracone was able to calculate how much he earned over three years. Based on that, he landed on the "underpaid list."
He likely won't stay there. As a CEO of one of the world's most important tech companies, he'll be paid well. But his huge starter kit of stock, valued at about $65 million, won't begin to vest until 2019. Another one-time stock grant worth $13.5 million vests over seven years.
There's lot of money to be earned, trickled out over years, but only if he performs well. And it could still be less what Tim Cook, Marissa Mayer, or Oracle's new co-CEOs earn.
CEO: Alan Trefler
Company: Pegasystems
3-Year-Average "Performance Adjusted Compensation": $758,740
2013 total compensation: $746,765
Reason: Trefler founder owns 52% of the company, so he takes a healthy salary and earns bonuses but doesn't gorge on stock options.
The stock trades at about $21 with a market cap of about $1.62 billion.
CEO: Charles Liang
Company: Super Micro Computer
3-Year-Average "Performance Adjusted Compensation": $626,990
2013 total compensation: $954,601
Reason: Founder CEO Liang owns 20% of the company. In 2013, he paid himself a reasonable salary ($303,682) and a good dollop of stock options ($633,652) and called it good.
The stock trades at about $36 with a market cap of about $1.65 billion.
CEO: George Colony
Company: Forrester Research
3-Year-Average "Performance Adjusted Compensation": $515,660
2013 total compensation: $618,042
Reason: George Colony owns over 40% of the company. In 2013, he paid himself $367,500 in salary and $238,140 in bonuses.
The stock trades for about $39 with a market cap of about $711 million.
CEO: Reece Kurtenbach
Company: Daktronics
3-Year-Average "Performance Adjusted Compensation": $480,960
2013 total compensation: $570,354
Reason: The CEO is the son of the founder, Dr. Aelred Kurtenbach, who still holds a 5% stake. In 2013 Reece was paid $282,227 in salary, some stock grants ($35,000), a bonus ($82,000), and $165,900 worth of options.
The stock trades for about $12.40 with a market cap of about $544 million.
CEO: John Kibarian
Company: PDF Solutions
3-Year-Average "Performance Adjusted Compensation": $383,530
2013 total compensation: $483,790
Reason: Co-founder Kibarian owns just over 8% of the company. In 2013, he paid himself $333,333 in salary, a $65,000 bonus and another $85,000 performance bonus, and no stock.
The stock trades at just under $15 with a market cap of about $462 million.
CEO: Kenneth Tuchman
Company: TeleTech Holdings
3-Year-Average "Performance Adjusted Compensation": $386,410
2013 total compensation: $360,604
Reason: Founder Tuchman owns just over 63% of the company. He pays himself $1 salary and is tossing his bonuses ($360,604 in 2013) into a retirement account.
The stock trades at about $23 with a market cap of about $1.15 billion.
CEO: Dr. James Truchard
Company: National Instruments
3-Year-Average "Performance Adjusted Compensation": $0
2013 total compensation: $1
Reason: Co-founder Truchard owns 19% of the company and he doesn't take a salary, stock, or bonuses.
The stock trades for about $31 and is worth about $4 billion in market cap. By the way, NATI paid 60 cents in dividends on its common stock in 2014. For his stake, that was worth about $14.5 million.
CEO: Larry Page
Company: Google
3-Year-Average "Performance Adjusted Compensation": $0
2013 total compensation: $1
Reason: Page doesn't take a salary, stock grants or options, or bonuses. But he owns 42% of the company, a stake worth $29.5 billion. (Co-founder Sergey Brin also takes $1 salary and owns over 41%.) Google doesn't pay dividends either.
And that's why this billionaire is our No. 1 underpaid CEO.
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