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General Motors CEO Makes 362 Times the Median Employee

Executive Pay Packages Are Out of Whack

General Motors CEO Mary Barra, the highest-paid chief executive among the Big Three, made nearly $29 million in 2022. Securities and Exchange Commission filings show that this is 362 times the median GM employee's paycheck. Publicly traded companies are required to disclose the ratio of their CEO's pay to their median employee's pay. Here is the executive pay at the Big Three:

CEO-worker 2022 compensation at Big Three automakers

General Motors

  • CEO Mary Barra: $29 million
  • Median worker: $80,034
  • CEO-worker pay ratio: 362-to-1


  • CEO Jim Farley: $21 million
  • Median worker: $74,691
  • CEO-worker pay ratio: 281-to-1


  • CEO Carlos Tavares: $24.8 million
  • Average worker: $67,789
  • CEO-worker pay ratio: 365-to-1

Source: U.S. Securities and Exchange Commission filings

These numbers are not out of line with other industries. The Economic Policy Institute estimates that CEO compensation has grown 1,322% since 1978, while typical worker compensation has risen just 18%. In 2020, CEOs of the top 350 firms in the U.S. made $24.2 million, on average — 351 times more than a typical worker.[1] This disparity raises questions about the fairness of employee compensation when compared to CEO pay packages.

According to Statista, the top ten executive pay packages in 2022 are as follows (in Millions of U.S. Dollars):[2]

  1. Barry McCarthy (Peloton)                                         $168.07         
  2. Timothy D. Cook (Apple)                                          $  99.42 
  3. Peter Zaffino (AIG)                                                    $  75.31            
  4. Hock E. Tan (Broadcom)                                          $  60.61    
  5. Richard B. Handler (Jeffries Financial Group)    $  56.90
  6. Satya Nadella (Microsoft)                                        $  54.95
  7. Hamid R. Moghadan (Prologis)                             $  48.15          
  8. Stephen J. Squeri (American Express)                 $  48.03    
  9. Jason D. Robins (DraftKings)                                 $  47.38 
  10.  Jay Chaudhry (Zscaler)                                           $  41.53

The CEO compensation figures reported by companies include the value of stock awards at the time of grant, along with salary, cash bonuses, perks and some retirement-benefit increases. Equity awards, the value of which can rise or fall significantly after grant, accounted for the bulk of pay for the highest-paid CEOs. These awards typically vest, or become fully the executive’s, over several years and can be tied to performance targets.

Shareholder skepticism for executive pay packages reflects an ethic of fairness. How can CEOs make so much when the average employee makes so little – and the disparity shows no sign of decreasing any time soon. Exec

"Say on Pay"

One problem is there aren’t sufficient checks and balances in the system to bring executive compensation under control. While these packages must be approved by the board of directors, it’s rare when a board votes against them. There is a “say on pay” provision set up by the SEC to give shareholders a say in approving compensation packages, but they are advisory only.

A good example of how the system can work is Citigroup’s shareholders that voted against CEO Vikram Pandit’s $15 million compensation package for 2011, a year when the bank’s stock tumbled. At the time of the vote, Pandit had received nearly $7 million in cash for 2011, with the remainder to be paid in restricted stock and cash over the next few years (and thus subject to possible restructuring by the board). Citigroup’s shareholders expressed concerns that the compensation package lacked significant and important goals to provide incentives for improvement in the shareholder value of the institution.

There is little need for shareholder oversight of executive pay if directors do a good job providing oversight themselves or have strong incentives to do a good job. However, conflicts of interest, such as when the CEO and CFO also serve on the board of directors, create an element of lack of accountability. Issues related to fairness and justice dictate that the oversight of executive compensation packages by shareholder groups is the right thing to do. The ethical question is: How can oversight be done in a way that protects shareholder and other stakeholder needs?

Claw Back of Executive Compensation Packages

Claw backs of executive compensation can also serve as a check on the scope of compensation packages and link them to financial reporting problems.

On October 26, 2022, the SEC approved final rules that will ultimately require public companies to adopt, enforce, and disclose policies to recover (or “claw back”) excess incentive-based compensation from current and former executive officers in the event of an accounting restatement, whether or not the executive officer was at fault for the restatement.

The new clawback rule requires that a listed company adopt and disclose a policy for the recoupment of incentive compensation from its current and former executive officers in the event the company is required to prepare “an accounting restatement due to material noncompliance.” The final rule also requires national exchanges to prohibit the listing of any security of an issuer that does not develop and implement a clawback policy that complies with the new rule.[3]


McDonald’s announced on December 16, 2021, that it has settled its lawsuit against former CEO Steve Easterbrook, clawing back his severance payment valued at $105 million. The fast-food giant first brought a suit against its disgraced ex-chief executive in August 2020, claiming he committed fraud and lied during the company’s internal probe into his behavior months earlier. As a result of that investigation, the company’s board found Easterbrook had a consensual relationship with an employee and fired him in November 2019. Despite their findings, the board still granted him a severance package that included cash and equity.[4]

In the lawsuit, McDonald’s alleged that new information about Easterbrook’s actions came to light in July 2020, prompting further investigation from the company. A probe allegedly revealed that Easterbrook lied to the company and destroyed information regarding his inappropriate behavior, including three alleged additional sexual relationships with employees before his firing.

There needs to be a national discussion about the disparity between executive compensation and that of the average worker. Perhaps the current UAW strike will hasten that day. I wish the candidates for President of the US raised this issue along the campaign trail. In one sense, it encapsulates the problem with corporate America today and why there is such pessimism on the part of the public. On the other hand, it shines light on the need for additional disclosures about social policies and governance and is why ESG is so important today.

Posted by Dr. Steven Mintz, aka Ethics Sage, on September 22, 2023. You can learn more about Steve’s activities by checking out his website at: https://www.stevenmintzethics.com/ and signing up for his newsletter.  


[1] Forbes, America’s Most Staggering CEO-To-Worker Pay Ratios, https://www.forbes.com/sites/niallmccarthy/2021/07/15/americas-most-staggering-ceo-to-worker-pay-ratios-infographic/?sh=763c78312c56.

[2] Statista, Ranking of the highest-paid CEOs in the United States as of 2022, https://www.statista.com/statistics/581271/ranking-of-highest-paid-ceos-in-the-us/.

[3] Harvard Law School Forum on Corporate Governance, SEC Finalizes New Clawback Rules, November 15, 2022, https://corpgov.law.harvard.edu/2022/11/15/sec-finalizes-new-clawback-rules/.

[4] McDonalds claws back $105 million from fired CEO Easterbrook accused of hiding relationships from the board, December 16, 2021.