Firms Pay More for External CEOs

Chief executives hired outside a company are paid significantly more than chief executives hired in-house, according to a new study. CEOs hired externally at Standard & Poor's 500 companies, for example, received a median total compensation package of roughly $12.2 million in 2007, or 51 percent more than CEOs with at least two years of tenure, who recorded a median pay of approximately $8 million, according to a study by Equilar, an executive compensation research firm based in Redwood Shores, Calif. Internally promoted CEOs made less than both groups, earning a median pay package of roughly $6.9 million. "This study highlights the costs of poor succession planning by boards and senior executives," said Alexander Cwirko-Godycki, a research manager at Equilar.

Large Gap in CEO Pay

Despite increasing public scrutiny of exorbitant CEO salaries, 2007 saw an increase in CEO pay at S&P 500 companies. The median increase in CEO pay at S&P 500 firms was nearly 16 percent, compared to a median increase of 2 percent for CEOs at smaller companies, according to a study released by The Corporate Library, an independent research firm. The median rate of increase in CEO pay at all the companies studied was 5 percent, less than half of the 2006 median increase, the study notes. But while there has been an overall slowdown of CEO pay increases, S&P 500 CEOs have been least affected.

Summer Redstone

In 1979, Sumner Redstone survived a fire at Boston’s Copley Plaza Hotel by hanging on, literally, to dear life from a third floor window with his severely burned hand. Doctors didn’t expect him to live through multiple surgeries, much less go on to steer media giant Viacom towards unprecedented success. But Redstone, with unequivocal resolve and driving ambition, has done just that. After graduating from Harvard Law School in 1947, Redstone worked briefly for the U.S. Justice Department and a Washington D.C. law firm before joining his father’s drive-in movie business in 1954. Redstone eventually took over the business and turned it into National Amusements Inc.

Dov Charney

The rise of retail giant American Apparel has its origins in cross-border trips founder and C.E.O. Dov Charney would make from his native Montreal to nearby U.S. towns. It was during these visits in the early 90s that Charney noticed the disparity between the comfortable casual clothing on store shelves south of the border and the cheaper polyester blends available in Canada. Charney started buying Hanes T-shirts and selling them at a premium back home, and the seeds of an American success story were sewn. After studying in New England, Charney relocated to Los Angeles and started American Apparel as a wholesale T-shirt manufacturer.

Dietrich Mateschitz

Dietrich MateschitzIt took Austrian businessman Dietrich Mateschitz 10 years to graduate from Vienna University with a marketing degree, a snails pace by most standards. But the Mateschitz has been on a fast track towards business success ever since. After a short stint with Unilever, Mateschitz moved to Blendax, a German cosmetics company since purchased by Procter and Gamble. Mateschitz marketed Blendax toothpaste, among other products. In 1984, during a Blendax business trip to Thailand, Mateschitz discovered the drink that would later become Red Bull. While in a Bangkok hotel lobby, he took a sip of an energy drink lorry drivers loved to drink for its stimulating virtues, “Krating Daeng,” or Red Bull.

Carlos Ghosn

Carlos Ghosn was born to Lebanese parents in 1954, in Porto Velho, a remote city of the Amazon basin in Brazil. He moved to Beirut with his mother when he was 6. Under Lebanon's French protectorate, he completed his secondary school studies at a Jesuit school in Beirut. He then entered the elitist French Ecole Polytechnique in 1974 from which he graduated in engineering with a specialization at the Ecole des Mines in Paris in 1978. Ghosn has French citizenship.

Jeffery Immelt

General Electric C.E.O. Jeffery Immelt was born in Cincinnati, Ohio in 1956. With GE since 1982, Immelt holds a B.A. in Applied Mathematics from Dartmouth College and an M.B.A from Harvard Business School. In addition to the C.E.O. post, Immelt is on the board of two non-profit organizations, including the Robin Hood Foundation, which attempts to alleviate poverty in New York City. As GE’s chief executive, Immelt gives the impression that he's at home at a turbine factory in Schenectady, N.Y., a research lab in Bangalore, and a dress rehearsal for Saturday Night Live. "This is not a man in a bubble," NBC's Conan O'Brien told Time magazine.

Lakshmi Mittal

Lakshmi Narayan Mittal was born in 1950 in Rajasthan, India. to a poor and large family. He spent most of his childhood in the village until his family moved to Calcutta. There, his father, Mohan, became a partner in a steel company and eventually made fortune. In 1969, Mittal graduated from St. Xavier's College in Calcutta with a business and accounting degree. Mittal started his career with the family in the steel-making trade until 1976, when the Mittal family founded its own steel business. Mittal then developed the international division of the company, starting with the purchase of a bankrupt plant in Indonesia. In 1994, due to disagreements with his father and brothers, he took over all the international trade of the family's steel business and branched out on his own.

Ratan Tata

Ratan N. Tata is the chairman of India's largest conglomerate, the Tata Group, established by his family's earlier generations. Tata is organized into seven divisions: engeneering, materials, chemicals, energy, NTIC, services and consumption goods. Ratan Tata was born in 1937, in Mumbai, India. The Tata family have been active in industry and philanthropy since the 19th century. The Tata Group, founded by Ratan's great grandfather, Jamsetji Tata, is one of the largest private employers in India. JRD Tata, Ratan's father, was the first Indian citizen to obtain a plane pilot's license, and he is considered the father Indian aviation. In 1932, he founded Tata Airlines, which became Air India in 1946. Ratan's childhood was troubled as his parents divorced when he was 7 years old. He was raised by his grandmother. After the Campion School in Mumbai, he graduated in Architecture and Structural Engineering from Cornell University, New York, in 1962.

Richard Branson

Sir Richard Charles Branson was born in Surrey, England in 1950. Dyslexic and saddled with poor academic performance, he nonetheless attempted two ventures at age 15: growing Christmas trees and raising budgerigars. Both ventures failed. He didn't have to wait long for his first successful venture, though,  which came at age sixteen when he launched Student magazine. In 1970, at age 20, he set up a mail-order business record. The following year, he opened a now famous chain of record stores, Virgin records, later known as Virgin Megastores.

Doris and Don Fisher

Doris and Don Fisher opened the first Gap store in Ocean Avenue, San Francisco in 1969. The locale, in order to make it "easier to  find a pair of jeans," also sold records and tapes. Today Gap is one of world's largest specialty retailers, earning a reported $ 15.9 billion in fiscal year 2006.

Craig Newmark

Craig Alexander Newmark, born December 6, 1952 in Morristown, New Jersey, is an Internet entrepreneur best known as the founder of the San Francisco-based Web site Craigslist. Newmark attended Morristown High School and graduated from Case Western Reserve University with a Bachelor of Science in Computer Science. Newmark has been a vocal advocate of keeping the Internet free. He has donated $10,000 to a non-profit group, NewAssignment.Net, which plans to combine the work of amateurs and professionals to produce investigative stories on the Internet. Newmark resides in San Francisco's Cole Valley and is active at Craigslist in customer service, mostly dealing with spammers and scammers.[1]

Carlos Slim

Carlos Slim Helú, the world’s second richest man, was born to Lebanese parents in Mexico City in January 1940. Slim gained notoriety when he led a group of investors, including France Telecom and Southwestern Bell Corporation, in acquiring Telmex and Telnor from the Mexican government in 1990 during the presidency of Carlos Salinas de Gortari. Today, Telmex operates 90 percent of Mexico’s telephone lines. The mobile company Telcel, also controlled by Slim, operates almost 80 percent of the country's cell phones. And over the last five years, Slim's wireless carrier, América Móvil, has purchased cell phone companies across Latin America, becoming region's dominant company and counting on more than 100 million subscribers.

Steve Ballmer

Steven Anthony Ballmer has been Microsoft Corporation's chief executive officer since early 2000. The son of a Swiss immigrant father who worked as a manager in Ford Motor Company, Steve Ballmer was born in 1956 in Detroit, Michigan. He now sits in the board of directors of the high school he graduated from in 1973, Detroit Country Day School. He later graduated in mathematics and economics from Harvard University in 1977, where he lived down the hall from fellow sophomore Bill Gates.

Meme Pederson

When Meme Pederson talks about putting on a dinner for the President of the United States, she does so rather casually. "There are the security concerns and all of that," she says, "but mostly you have to consider the likes and the dislikes. For example, Bill Clinton doesn't really like chocolate because he's lactose intolerant." As co-founder and CEO of Taste Catering, headquartered in San Francisco, Ms Pederson is at the helm of one of the most respected and reputable caterers and party planners in the country.