Americans aren’t too clear how much CEOs actually take home in compensation, but even so, they believe these corporate leaders make too much money.
This comes from a new survey on the public’s perception of CEO compensation, led by the Rock Center for Corporate Governance, an initiative of Stanford Graduate School of Business and Stanford Law School. The survey queried 1,200 Americans on what CEOs make, how they should be paid for performance, and whether government should be involved.
Overall, respondents believed most CEOs made less than a tenth of what they actually do—on average, they thought CEOs earned nearly $1 million, whereas the real average is about $10 million. Still, 74 percent think those CEOs are overpaid.
“CEO compensation figures are much higher than the public is aware of,” says David F. Larcker, a Stanford Graduate School of Business professor of accounting and the lead researcher on the study. “In many parts of the country, it is incomprehensible that anyone can earn this much money.”
CEO pay has risen sharply over the past few decades. CEOs today can make between 210 and 300 times what their workers earn. In comparison, they made 20 times their workers’ pay in 1965, according to the Economic Policy Institute.