In the corporate world, one question people often want to know is: which position makes the most money? There is no one answer: positions that fit the bill include anaesthesiologist, surgeon, corporate lawyer, Machine Learning engineer, and so on.
But the compensation packages of top executives, particularly Chief Executive Officers (CEOs), have long been a subject of scrutiny. As the highest-ranking officers in a company, CEOs are responsible for driving strategy, profitability, and overall success. Naturally, then, their pay has often reached staggering heights, reflecting the immense value placed on exceptional leadership.
In recent years, we have witnessed a trend of rising executive compensation. A 2019 report finds that CEO compensations grew by 940% between 1978 and 2018. So, which position makes the most money in 2024? This article makes a case for the CEO position.
Overview of CEO Compensation
Various components make up a CEO’s total compensation. Typically, these include a base salary, annual bonuses tied to performance targets, long-term incentives such as stock options and restricted stock units, and additional perquisites or perks like company cars, private jet usage, and club memberships.
The types of benefits a CEO gets often depend on factors like company size and industry. Larger corporations and sectors like technology, finance, and healthcare naturally offer higher compensation levels. Another factor is CEO’s experience, tenure, and track record of driving company performance heavily influence their earning potential.
Recently, there has been increasing scrutiny of shareholders and calls for transparency about executive compensation. Regulations like the pay ratio disclosure rule have shed light on the disparity between CEO pay and regular employee compensation, starting conversations about income inequality and fairness.
Highest-Paying Industries for CEOs in 2024
Below are some industries with the highest compensation rates for CEOs.
Technology and Internet Companies
The IT and internet sector has had the centrestage when it comes to CEO remuneration packages that have been on the high end all along. The success of Google, Apple, Microsoft, and Amazon, in particular, is officially measured by executive pay according to the rapidly growing value of these industry trailblazers.
For example, Apple’s CEO, Tim Cook’s, compensation package is valued at $63,209,845, primarily driven by stock awards. Similarly, Microsoft CEO Satya Nadella’s over $48 million is mostly driven by stock awards. Generally, tech CEOs’ compensation packages are heavily weighted towards long-term incentives like stock options and restricted stock units, aligning their interests with those of shareholders and the company’s long-term growth.
Financial Institutions
Another industry known for its high compensation rates for CEOs is the financial industry. This is due to factors like the complexity of operations, high-stakes deals, and, most importantly, the significant impact these institutions have on the global economy.
Giant financial institutions like JPMorgan Chase and Morgan Stanley pay their CEOs as high as $36 and $37 million, respectively. Both of these companies’ CEOs’ pay was reported to have risen by 4% and 17%, respectively, between 2022 and 2023.
Biopharmaceutical Companies
Rising star of the biopharma field in recent years has also been the product of constant change and groundbreaking developments, leading to the increased need for leaders and competence up high. The CEOs in the R&D and global operations sector should not only focus on managing research development and regulatory bodies but also develop skills to do it within the stipulated timeframe. For this reason, they are highly compensated, earning between $18.5 and $124 million, according to a 2023 ranking of the highest-paid biopharma CEOs in the United States.
Top-Paid CEOs
According to a ranking by Northwest Education, here are the three highest-paid CEOs in the world:
Elon Musk
Elon Musk is the CEO of Tesla Inc., a position he assumed back in 2008 when the company was still relatively new. Under his leadership, Tesla has grown into a force in the automotive industry, completely changing the way we think about sustainable transportation.
Though, as CEO of Tesla, Musk receives a relatively moderate salary, his large total compensation package makes up for it. He is reported to earn a total of $23.5 billion yearly, the largest in CEO compensation package history. In 2018, Tesla granted Musk a pay package worth $56 billion, but this was voided by a Delaware judge, Kathaleen McCormick, on the basis that it was not a fair compensation plan as it overpaid Musk. However, in 2024, Tesla has reinstated the package, leaving it to shareholders’ approval.
Tim Cook
Tim Cook took over as CEO of Apple Inc. after the legendary Steve Jobs resigned in 2011. Since then, he has guided Apple through a period of remarkable growth and innovation.
Cook’s total compensation package as CEO is estimated to be around $770.5 million per year. Apple’s consistently improving financial performance is to thank for this lavish payment package. Cook has overseen the successful launches of new products like the iPhone 14 and Apple Watch Series 8, as well as the company’s foray into emerging technologies like augmented reality and artificial intelligence.
Sundar Pichai
Sundar Pichai is an Indian-American businessman and CEO. He joined Google in 2004 as a product management lead, but by 2015, he had become the CEO of both Google and its parent company, Alphabet Inc. Since then, he has played a central role in driving the company’s growth and expansion into new markets.
For this, he earns a total compensation package of about $280 million per year. This mostly comprises stock awards and performance-based incentives.
Want to find out more about investments, the richest people, and who owns companies – then you should see our other articles in the business category.
