published Sunday, May 15th, 2011

Salaries at the top


• $9 million: size of typical pay package for head of S&P 500 company CEO in 2010

• 11 percent: average gain in CEO pay in 2010 over 2009

• 39 percent: average increase in cash bonuses to CEOs

Source: AP, Wall Street Journal

Top executives for most Chattanooga area companies saw their pay rebound last year as profits swelled and stock prices climbed.

CEO pay grew on average by about 15 percent among local companies that are publicly traded or publicly report compensation, proxy statements show.

That’s a little higher than an 11 percent gain recorded nationally in a study by Hay Group for The Wall Street Journal.

Thomas R. Watjen, Unum Group’s CEO, drew $11.48 million in total compensation last year, company figures show. That’s up 22.4 percent from a year ago, but less than the $12.26 million he earned in 2008.

Jim Sabourin, Unum’s vice president of communications, said Unum’s shares grew 26 percent in value last year.

“Over the last five years our shares have outperformed the S&P 500,” he said, adding the insurer announced a 1.5 billion share repurchase in the last 12 months.

Still, Sabourin said, much of Watjen’s pay package rise last year is attributed to changes in pension value. Those benefits, which the Securities and Exchange Commission requires companies to report, rose for Watjen because of the way the insurer calculates them for employees, he said.

Unum, in a separate calculation of executive pay that takes out pension benefit values, said Watjen’s pay last year was $8.82 million, up less than 1 percent from 2009.

David R. Parker, CEO of trucking company Covenant Transportation Group, saw his total compensation package rise 58.6 percent to $1.13 million.

According to the company’s proxy, Parker posted increases in both stock awards, $215,550 from $85,748 in 2009, and nonequity incentive plan compensation, $294,525 from zero the year before.

In 2010, Covenant’s shares soared 129.9 percent in the year as the company reported its best earnings results since 2005.

At Calhoun, Ga.-based Mohawk Industries, CEO Jeffrey S. Lorberbaum’s compensation grew 46.1 percent in 2010 to $2.19 million, according to the company’s proxy.

Lorberbaum received a $66,000 bonus, while his stock award rose to $312,016 from $231,698 in 2009. Also, he received nonequity incentive plan compensation of $816,000, up from $270,000 in 2009.

Mohawk’s shares rose 19.2 percent last year.

First Security Group Inc., a Chattanooga bank holding company, is yet to release its proxy statement with executive compensation from 2010.

An analysis by The Associated Press, using data from executive compensation research firm Equilar, showed that the typical pay package for the head of a company on the S&P 500 was $9 million in 2010.

The study showed that the biggest gains came in cash bonuses as two-thirds of executives got a bigger bonus last year than they had in 2009.

CEOs were rewarded as corporate profits soared last year with the economy gradually getting stronger and companies cutting costs. Profits for the companies in the AP analysis rose 41 percent last year.

Hodgson said that looking ahead in this year, he foresees similar size hikes in CEO pay.

“I think we’ll see the same kind of increases,” he said.

about Mike Pare...

Mike Pare, the deputy Business editor at the Chattanooga Times Free Press, has worked at the paper for 27 years. In addition to editing, Mike also writes Business stories and covers Volkswagen, economic development and manufacturing in Chattanooga and the surrounding area. In the past he also has covered higher education. Mike, a native of Fort Lauderdale, Fla., received a bachelor’s degree in communications from Florida Atlantic University. he worked at the Rome News-Tribune before ...

Comments do not represent the opinions of the Chattanooga Times Free Press, nor does it review every comment. Profanities, slurs and libelous remarks are prohibited. For more information you can view our Terms & Conditions and/or Ethics policy.
timesfreepress said...

Do you think CEOs should be rewarded when their companies do better? Or is it unfair to provide even more monetary benefit when so many are in need?

May 15, 2011 at 1:57 a.m.
hcirehttae said...

• $9 million: size of typical pay package for head of S&P 500 company CEO in 2010 • 11 percent: average gain in CEO pay in 2010 over 2009 • 39 percent: average increase in cash bonuses to CEOs

One word: obscene.

May 15, 2011 at 8:10 a.m.
rolando said...

If the rewarded CEOs put policies in place or made decisions that resulted in the company's recovery to profitability, they worked for it and they deserve it.

Companies are not unions -- companies reward excellence, they do not penalize it. This is how we became the greatest country on earth [former title] and why the world flocked to our shores bringing their own skills and hard work.

If rewarding the capable is what it takes to return our industry and our jobs to our shores, so be it. I certainly hope they succeed because if they do, we do.

To allow an employee to go unrewarded for his outstanding performance is true obscenity. Why else excel if not for the money or other benefits? For recognition alone? -- don't make me laugh.

On the other hand, giving a reward for simply showing up -- as our unions do -- is rewarding poor performance and results in even more poor performance. Just look at our schools for evidence of that. Or our once-supreme auto industry. Under their control, the slothful lose nothing by their sloth; moreover, if the hard worker gains nothing more than the lazy and incompetent do [other than their undying emnity], why work hard and excel? This is where we are today.

It is called greed -- everything living survives on that basis. It is the strongest "instinct" of all...the will to survive.

May 15, 2011 at 8:51 a.m.
Winner said...

Obscene? Nay. I'd say the salaries of athletes are obscene. At least executives in these companies had to actually WORK to get the money they are making.

May 16, 2011 at 7:32 a.m.
ITguy said...

Obscene. The shareholders are getting screwed.

Winner, athletes sell tickets. They earn their money.

May 16, 2011 at 6:28 p.m.
bigguy said...

Be interesting to see how companies would be doing if the govmint wadden meddlin in der business. Bet we wudden have no recession no more.

May 16, 2011 at 7:17 p.m.
chet123 said...



April 4, 2012 at 1:10 p.m.
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