7 Top CEOs Working for Pennies

By Liz Hoffmann - August 23, 2012 | Tickers: AWK, BRK-B, BRK-A, CIT, GOOG, ISRG, MNST, WFM | 0 Comments

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These days, we're all on the look out for a great value.  Whether we're buying household goods, travel services, or large-ticket items we want to get the most for our money.  So when it comes to the top CEOs, perhaps we should also consider them in terms of value.  How much is their total compensation and how does that correspond to the leadership that they provide for the company they run?  How much total return do they deliver for the common shareholder?

To answer that question, I took a look at Forbes 2012 CEO compensation numbers and scrubbed the data according to my own ranking system.  Beyond just returns, CEOs got extra points for longevity, consistent performance, and also for how much company stock they owned.  The bigger those numbers, and the smaller their total comp, the better.  My list of seven great CEOs working for a pittance is as follows:

Mega-Cap Companies

#1:  Warren E. Buffett, CEO of Berkshire Hathaway (NYSE: BRK-A)  Market Cap $213.30B

Salary:  $0.10 mil, Bonus NA, Other $0.39 mil   Total Annual Comp: $0.49 mil

6-Year Average Comp:  $0.33 mil      

6-Year Annual Total Return (BRK-A):  5%                         

Return on stock during CEO tenure (42 years):  23%

Percent of company stock Buffett owns: 22.20% with an approximate value of $44,486.68 mil

#2:  Larry Page, CEO of Google (NASDAQ: GOOG) with a market cap of $221.45B

Salary:  $0.00, Bonus NA, Other NA   Total Annual Comp: $0.00

6 Year average comp:  NA

Return on stock during tenure (one year):  4%

Percent of company stock Page owns:  8.12% with an approximate value $16,252.9 mil

Large-Cap Companies

#3  John P. Mackey, CEO of Whole Foods Market (NASDAQ: WFM) with a market cap of $17.68B

Salary:  $0.00, Bonus NA, Stock Gains: $0.68 mil, Total Annual Comp:  $0.68 mil

6 Year Total Compensation:  $1.01 mil

6 Year Total Return:  7%

Total return on stock during tenure (32 years):  18%

Percent of company stock Mackey owns:  0.61% with an approximate value of $94.2 mil

#4 Gary S. Guthart, CEO of Intuitive Surgical (NASDAQ: ISRG) with a market cap of $20.44B

Salary:  $0.52 mil, Bonus $0.34 mil, Other NA  Total Annual Comp: $0.86 mil

6 year average comp:  NA

Return on stock during tenure (2 years):  28%

Percent of company stock Guthart owns:  0.10% with an approximate value of $20.1 mil

Mid-Cap Companies

#5:  Rodney C. Sacks, CEO Monster Beverage (NASDAQ: MNST) with a market cap of $10.73B

Salary:  $0.41 mil, Bonus $0.23 mil, Other $0.05 mil   Total Annual Comp:  $0.645 mil

6 Year Average Comp:  $11.04 mil

6 Year annual total return on stock:  27%

Total return on stock during tenure (21 years):  30%

Percent of company stock Sacks owns:  0.24% with an approximate value of $24.6 mil

#6:  John A. Thain, CEO of CIT Group (NYSE: CIT) with a market cap of $7.70B

Salary:  $0.50 mil, Bonus NA, Other NA   Total Annual Comp:  $0.50 mil

6 Year Average Comp:  NA

Return on stock during tenure (two years):  16%

Percent of company stock Thain owns:  0.14% with an approximate value of $12.4 mil

#7:  Jeffry E. Sturba, CEO of American Water Works (NYSE: AWK) with a market cap of $6.67B

Salary:  $0.68 mil, Bonus NA, Other NA   Total Annual Comp:  $0.68 mil

6 Year Average Comp:  NA

Return on stock during tenure (2 years):  35%

Percent of company stock Sturba owns:  0.04% with an approximate value of $2.2 Million

There you have it.  Seven great value CEOs to consider when you are out CEO shopping.  However, please note that not all of them are the pure manifestation of altruism.  While clearly John Mackey and Larry Page do not receive any additional compensation and are content to work basically for pennies (and it helps to have already acquired multi-million and multi-billion dollar worth), the same is not true for all.  Take Gary Guthart for example.  According to the Intuitive Surgical 2012 Proxy Statement, he was awarded a total of almost 70,000 option grants for 2010 and 2011.  And yes, while options do tie total comp to company performance, they also allow the CEO to avoid payroll taxes (so sorry Uncle Sam!). So in conclusion, don't be penny-wise and option foolish.  For your first pass look at the the salary, and if that passes mustard, then dig deeper from there.

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