Business & industry

CFO pay is rising steadily, but some finance chiefs are not happy with how their bonuses are determined.

Median CFO compensation in 2012 increased 6% relative to 2010, according to the 2013 CFO Compensation Survey, which was released by the AICPA and Arizona State University.

The largest compensation increases went to CEOs, presidents, and COOs, whose pay declined the most in the recession, according to the survey, which is conducted every other year and is based on responses from 2,300 executives, mainly CFOs.

The increase in median compensation for CEOs, presidents, and COOs in 2012, relative to 2010, was 35%. Compensation is defined as salary and bonus.

Since 2006, median CFO pay has risen 18.75%, compared with an 11.1% rise in median pay for CEOs, presidents, and COOs, according to the survey, available at CFO pay has not experienced the ups and downs of CEO pay. Instead, finance chiefs’ pay has increased slightly each year, which could be a reason, according to another survey, that CFOs in general are happy with their jobs.

CFOs expressed less satisfaction if their annual bonuses were awarded subjectively, according to the survey.

On average, CFOs in private companies have 58% of bonuses contingent on meeting financial performance goals, 13% contingent on explicit nonfinancial targets such as customer satisfaction or safety targets, and 27% awarded subjectively. The remaining small percentage is funded in other, unspecified ways.

Heavy use of subjective bonuses led to low satisfaction for CFOs about the design of their compensation packages. The survey found that highly dissatisfied CFOs had 40% of their bonus awarded subjectively, compared with 25% for satisfied finance chiefs.


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