What the boss makes
Theyre not the glamour boys of big business and most of them have surprisingly modest (by comparison) paychecks. Nevertheless, the CEOs of the largest publicly held food companies probably dont have to clip their own coupons to pay for groceries.
Forbes magazine published its annual listing of CEO pay in the May 8 issue. Pay for the big food guys ranged from the $18.61 million gross of General Mills Stephen Sanger (thats 18,610 Big Gs) to the modest $1 million flat for Gary Rodkin, who just took over at ConAgra. (Rodkins pay is misleading. He just joined ConAgra last October and apparently has a minimum annual bonus of $2 million, which hasnt been paid yet.)
Sangers big paycheck, like that of most of the CEOs, includes a lot more than just salary. The General Mills chairman/CEO (not everyone on the list also was a board chairman) has a stated salary of $2.47 million, an 8 percent increase from the previous year, plus $348,000 in other income and nearly $16 million in stock gains, according to the magazine. Forbes figures into compensation stock grants only as they vest and realized gains from exercised stock options.
Sangers total of $18.6 million ranked him 69th on the Forbes list of 500 executives from all industries. The magazine said he earned $35 million over the past five years and holds $43 million worth of stock.
We dont begrudge big pay packages provided the chief is delivering returns to shareholders, the magazine wrote.
And some are, but apparently not the foodies. Leading the list of top performers is John Buscksbaum of General Growth Properties, a real estate investment trust. Paid an average of $624,000 over the past six years, hes delivered a 37 percent annual return to shareholders. Give this guy a raise, the magazine says.
None of the 10 CEOs on the top performers list was from our sector. Fortunately, neither was any of the 10 worst.
However, Joseph Luter III of Smithfield Foods made Forbes 20/20 club, a list of 10 executives who produced at least 20 percent returns annually over 20 years. So seniority and the feeling that you own the company may help performance. The 66-year-old Luter is chairman and CEO and the third Joseph Luter to head the company (his grandfather founded Smithfield in 1936).
That [annualized] 20 percent is no small feat. These companies are worth, on average, 700 times what they were when the company listed or the current chief executive took office, Forbes wrote about the 20/20 club. Luter, whos been at the helm 31 years, produced a 29 percent annualized return, second highest on the list (Lawrence Ellison of Oracle delivered 31 percent). That puts Luter two steps above one Warren Buffett of Berkshire Hathaway.
|Name||Company||Pay ($ millions)||Rank|
|Stephen Sanger||General Mills||18.61||69|
|Alan Lafley||Procter & Gamble||16.87||79|
|William Wrigley Jr.||Wm. Wrigley Jr. Co.||13.00||109|
|John Cahill||Pepsi Bottling Group||12.23||119|
|Joel Johnson||Hormel Foods||12.06||122|
|Joseph Luter III||Smithfield Foods||10.80||132|
|Norman Wesley||Fortune Brands||9.60||150|
|E. Neville Isdell||Coca-Cola||6.49||220|
|John Tyson||Tyson Foods||5.54||249|
|Douglas Conant||Campbell Soup||5.32||259|
|Gregg Engles||Dean Foods||4.75 1||275|
|William Johnson||H.J. Heinz||3.51||325|
|G. Allen Andreas||Archer Daniels Midland||3.28||347|
|W. Leo Kiely III||Molson Coors Brewing||3.17 1||356|
|Richard Sands||Constellation Brands||2.30||392|
|Lowry Kline||Coca-Cola Enterprises||1.92 2||422|
|Patrick Stokes||Anheuser-Busch Cos.||1.89||425|
|Paul Varga||Brown-Forman||1.79 2||430|
|Brenda Barnes||Sara Lee||1.43 2||449|
|Gary Rodkin||ConAgra Foods||1.004||78|
2. New chief executive, pay may be for a prior position
Source: Forbes, "Executive Pay," May 8