As we have written often in recent months, food & beverage processors are weathering the economic storm better than most companies. More evidence lies in the paychecks of their CEOs. While Forbes magazine reports an aggregate 11 percent decrease in CEO salaries in 2008, the food & bev CEOs we track have seen a collective 34 percent increase in pay.
Former stock broker Gregg Engles, Dean Foods’ CEO (also chairman), remains atop the food & beverage heap, although he took a 61 percent pay cut. That dropped him to No. 46 on the Forbes list; he was 15th last year.
Out of nowhere comes our No. 2 Timothy Smucker. Last year, JM Smucker was too small to qualify as one of Forbes’ 500 largest companies. But it doubled its size with last year’s acquisition of the Folgers coffee business from Procter & Gamble.
Forbes published its annual listing of CEO salaries in its May 6 issue (also search for it at www.forbes.com). The magazine counts as compensation salary and cash bonuses; other compensation, such as vested stock grants; and stock gains, the value realized by exercised stock options. For the second consecutive year, Lawrence Ellison of Oracle Corp. placed first at a cool $557 million, 2½ times the gross of the next guy on the list. Interestingly Nos. 2-5 all were execs at oil companies.
Pay for food industry bosses ranged from Engles’ $25.51 million gross to the scant $130,000 of Leland Tollett, who came out of retirement to again head Tyson Foods during these trying times. (One step behind Tollett was another low-paid CEO: Berkshire Hathaway’s Warren Buffet, who makes only $100,000 a year.)Some of the big gainers on this year’s food & beverage list:
- Douglas Conant, Campbell Soup, +70 percent
- Jeffrey Ettinger, Hormel Foods, +44 percent
- A. D. David MacKay, Kellogg, +42 percent
- David West at Hershey actually had the biggest increase, 367 percent, but coming on at the end of 2007, he was paid only $810,000 that year
The biggest losers on our list:
- Bruce Carboneri, Fortune Brands, -50 percent
- Alan Lafley, Procter & Gamble (little food left), -41 percent
- Gary Rodkin, ConAgra, -28 percent
- And of course Engles
- PepsiCo’s high-profile CEO, Indra Nooyi, took a cut of 26 percent
In addition to Smucker, there were several new names on the list, most of them new CEOs at their respective companies.
Also notable is that many names on the list are both CEO and chairman, but not everybody holds both jobs. That can explain some disparity in pay.