The median compensation of the 50 highest-paid CEOs of Minnesota public companies was $4.3 million, a 50.5% increase over last year — better than what national pay surveys have found.

Most surveys use slightly different methodologies from the Star Tribune, which counts stock options when they are vested or exercised instead of granted. Still, Minnesota’s results stood out. 

Equilar, a provider of board intelligence solutions, annually looks at pay packages at the 500 largest public companies in the United States. The firm’s survey found that median CEO compensation among the companies was $12.1 million, an 8% increase over the previous year and a 25% increase over the past five years.


While the median compensation rose, the collective compensation for all 50 CEOs was $380.4 million, down 12.3% from the total from the Star Tribune’s list last year.

The dip, which amounted to $53 million, was mainly due to a handful of CEOs who did not exercise as many of their previously issued stock options in 2018 as the year before. The group includes Ameriprise’s James Cracchiolo, who did not exercise any options in 2018 but exercised $40 million worth in 2017, when he was the highest-compensated CEO.

The second-highest-compensated CEO last year, Patrick McHale of Graco, moved to the top spot this year, even though he realized 26% less in total compensation than the prior year. McHale’s salary and bonus increased, but his option gains were $12.3 million less than the prior year.

All but three CEOs on this year’s list earned a cash bonus for meeting or exceeding a variety of corporate performance goals, mostly financial goals. While 38 saw some gains from restricted stock, only 17 of the 50 exercised options. The value of those long-term equity awards were affected by the fourth-quarter downturn in the stock market.


“The one thing that I would highlight as it relates to the most recent year pay, trendwise, is that in 2018 what we saw was a nice relationship between pay and performance,” said Brian Blackwood, a managing director at consulting firm Willis Towers Watson.

Blackwood noted the solid operating results of companies in 2018 and said that strength translated into increasing bonuses and other pay categories.

From that point of view and from a shareholder lens, we are seeing directionally the kind of pay for performance orientation that is desired out of the market,” Blackwood said.

Equilar noted in its annual report that while the connection between pay and performance has gotten stronger since broad use of the nonbinding advisory Say-on-Pay vote — a shareholder advisory vote on executive compensation — was implemented in 2011, the trend has still been toward increasing executive pay levels.

That increasing pay rate has outstripped the 3% gains that nonexempt hourly nonunion workers and nonexempt salaried workers have averaged each of the past three years, according to WorldatWork, a nonprofit association that studies compensation and total rewards.


A lot can change in a company’s history over 10 years, including leadership at the top.

Looking at the Star Tribune executive compensation rankings from 2009 and this year, only five CEOs are still there: Cracchiolo of Ameriprise Financial Inc.; Douglas Baker Jr., Ecolab Inc.; H. Chris Killingstad, Tennant Co.; McHale of Graco Inc.; and Cheryl Beranek, Clearfield Inc.

Those companies have mostly thrived, and the executives have ridden rising market valuations to large long-term equity gains.

All but Beranek are in the top 15 on the list. Beranek leads the smallest of the five companies, and her compensation of $335,454 last year put her at 63rd on the list this year. She was ranked 96th on the 2009 list.

In 2009, the list included the CEOs at 100 Minnesota-based public companies; 52 of those are no longer around as independent Minnesota public companies — whether they have been acquired, moved, gone private, delisted or gone out of business.

Some of those names from the past include St. Jude Medical, Travelers Cos. Inc., Supervalu, Alliant Techsystems, Buffalo Wild Wings Inc. and Caribou Coffee Co. Inc. They also include lesser-known names such as American Medical Systems Holdings, Navarre Corp. and Zareba Systems Inc.


Information on the largest CEO pay packages comes from the company’s annual proxy or other corporate filing with the Securities and Exchange Commission. The Star Tribune counts total compensation as the sum of salary, bonus, cash-based incentive plan compensation, miscellaneous compensation, and the value of exercised stock options and restricted stock that has vested during the year. The bonus category includes annual nonequity incentive plan compensation and any discretionary bonuses.

The CEO pay ratio is based on the CEO’s total compensation from the summary compensation table as prescribed by the SEC, which is salary, bonus, cash-based incentive plan compensation, miscellaneous compensation, pension value changes, and the grant date value of new stock options and restricted stock awards. Smaller reporting companies are not required to disclose the pay ratio.