6 Indian-American CEOs in list of top 200 highest-paid executives in 2018

As many as six Indian-Americans figure in the list of 200 highest-paid chief executives in America in 2018, whose compensation grew at double the pace of ordinary workers’ wages, according to the New York Times' annual analysis based on a survey by Equilar, an executive compensation consulting firm that conducts the survey for the Times every year.

A May 24 Times report said topping the list was Elon Musk, CEO of Tesla with a $2.3 billion package followed by David M. Zaslav, the chief executive of Discovery, an entertainment company, at $129.5 million. Nikesh Arora, the Indian-American CEO of Palo Alto Networks, ranked third in the overall list with a compensation package that was worth $125 million.

But conspicuously absent from the list was the name of Sundar Pichai, CEO of Google, whose total earnings in 2018, after calculating older stock that vested, topped $470 million in 2018 according to the latest proxy statement from Google's parent company, Alphabet,a May 1, 2019 report by Axios said.

The reason for the omission of Pichai’s name could be because the company did not file proxy statements for fiscal year 2018 on time. According to a methodology note by Equilar, the Equilar 200 includes the largest pay packages awarded to CEOs from U.S.-based or listed companies with more than $1 billion in revenue that filed proxy statements for fiscal year 2018 by April 30, 2019.

Besides Arora, who topped in the ranking among the six Indian-American CEOs,other Indian-American CEOs in the list included Vivek Shah of j2 Global, a publicly traded technology company based in Los Angeles, ranking 10th with 45 million; Shantanu Narayen of Adobe, ranking 52nd with 28 million; Satya Nadella of Microsoft ranking 35th with 26 million; Ajay Banga of Mastercard ranking 76th with 20 million and Bob Patel of LyondellBasell Industries ranking 108th with 18 Million.

Upon joining Palo Alto Networks last year, Arora took $20 million of his own money and purchased company stock. The report said when chief executives invest a portion of their fortunes, it can strengthen the alignment between the top executive and shareholders. But this incentive may not be as strong in Arora’s case since the $20 million is a relatively small proportion of his total 2018 compensation, valued at $125 million.

The report said nearly every year, CEOs already earning huge sums get even bigger payouts. In 2018, the Times analysis shows, they did particularly well  the median boss received compensation of $18.6 million — a raise of $1.1 million, or 6.3 percent, from the year prior.

“These gains at the top are in spite of recent efforts to restrain CEO pay. Earlier this decade, Congress required that companies disclose the ratio of their chief executive’s pay to that of their median employee. Lawmakers also gave shareholders a special but nonbinding vote on the matter,” the report said.

Another trend theoretically contributing to accountability is that company boards, under pressure from some shareholders and advisory firms, have tied a lot more of a chief executive’s pay to a company’s performance.

The report noted that Uber’s chief executive, Dara Khosrowshahi, who got a $45.3 million award, would have been 10th on Equilar’s list, but since the company was not public last year, it was not included in the rankings. Also missing were the CEOs of private equity firms and hedge funds, whose compensation can run into the hundreds of millions, the report clarified.

Equilar does its analysis based on headline compensation numbers from proxy statements. But those are estimates, often based on companies’ complex calculations of what stock and options grants will be worth in the future. Some shareholder advisory analysts do their own math and conclude that the awards are likely to pay out far more than companies claim, the report said.

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