Previous Page 2 of 3 Next

Continued: Minnesota CEO pay: Lots of options

  • Article by: PATRICK KENNEDY and JOHN J. OSLUND , Star Tribune
  • Last update: July 29, 2013 - 9:46 AM

“Goal setting has been very difficult,’’ Lindner said. “But that’s the way it’s supposed to work; if you don’t meet the goals, you don’t get the bonus.’’ Or you get a smaller one.

CardioVascular Systems CEO David Martin, for example, got a discretionary 2012 bonus of $130,000, down 62 percent from his $348,000 bonus in 2011.

“Despite the failure to meet financial or MBO objectives,’’ the company’s board noted in its proxy statement that top management had met “important operational milestones in fiscal 2012’’ including the successful conversion of ­customers to new products.

Rank-and-file salaries

Lower on the corporate food chain, average increases for salaried workers in the Midwest rose about 2.8 percent in 2012, about the same as last year, according to WorldatWork, the nonprofit salary and benefits tracking firm. Nationally in 2012, salaries for officer-level employees rose 2.9 percent, the firm reported.

Among all the companies responding to the WorldatWork annual survey, between 5 and 8 percent reported salary budgets that remained effectively frozen in 2012, depending on the job category. That’s down from 6 to 10 percent in 2011.

But frozen salaries continue to thaw. In 2009, the trough of the Great Recession, 43 percent of companies reported pay freezes. In 2010 the number was still 20 percent.

Does rising CEO pay in 2012 suggest that rank-and-filers can expect a bigger raise, too? Not likely. Organizations don’t appear to be playing catch-up with their budgets; very few are reporting average salary increases above 4.1 percent, WorldatWork reports.

“With the exception of shortages unique to specific jobs or industries, employees have few competitive job opportunities,’’ WorldatWork concluded. “Therefore employers do not need to deliver higher pay increases to retain key talent.’’

Robert Kennedy, a professor in the department of ethics and business at the University of St. Thomas’ Opus School of Business, said that a longtime guiding philosophy in executive compensation is that the CEO and the CFO are the ones who make the biggest difference in a company’s performance.

“There’s a recognition that the talents are scarce and the people who have them are more mobile,’’ Kennedy said. “That translates into more sensitivity about pay on the part of the board and the compensation committee.’’

Where does that leave employees?

“People are generally ill-disposed to leaving if pay is the only reason,’’ Kennedy said “They are willing to stay if they like the people and the work.’’

Female CEOs

The number of female CEOs in our survey rose to six, from four last year. They are:

Sally Smith, CEO at Buffalo Wild Wings, ranked highest at No. 30 with $3.5 million in total pay. Smith, who was ranked No. 20 a year ago with $4.1 million, became the first female CEO in our survey to crack the top 20.

Shelly Ibach of Select Comfort joins the list at No. 42 with $2.1 million in total pay. She succeeded the retiring William McLaughlin at the head of the Sleep Number bedmakers.

Cheryl Beranek of fiber-optic connections maker Clearfield Inc. ranked No. 61 with $710,000 in total pay.

  • get related content delivered to your inbox

  • manage my email subscriptions





Connect with twitterConnect with facebookConnect with Google+Connect with PinterestConnect with PinterestConnect with RssfeedConnect with email newsletters