OTTAWA—Following two blistering years of all-time high compensation, Canada’s 100 highest-paid CEOs pocketed $13.2 million, on average, in 2023—the third biggest haul since the Canadian Centre for Policy Alternatives (CCPA) began tracking CEO pay.
The CCPA’s new report, Company Men: CEO Pay in Canada, 2023, shows that, on average, these 100 CEOs were paid 210 times more than the average worker’s wage in 2023. CEOs have always made more than the average worker, but the gap is growing. In 1998, they made 104 times more than the average worker’s wage.
“It’s hard to conceive of income gaps that large,” says Senior Economist David Macdonald. “By the first working day of the year, January 2 at 10:54 a.m., these 100 CEOs already made, on average, $62,661. It took the average Canadian worker all year to earn that amount.”
Company Men notes several trends and busts key myths about CEO pay and their worth:
Juicy bonuses: The major reason why CEO pay is growing so much more rapidly than worker pay isn’t their salary, pension or benefits—it’s their juicy bonuses. In 2023, the cash bonus was, on average, $2.3 million per CEO. This isn’t the average workers’ holiday bonus and it is double the 100 CEOs’ average salary line. In theory, bonuses are supposed to be tied to how well the company is doing. In reality, CEO bonuses rise regardless of performance.
Company men, literally: The top 100 CEO list is almost all men—there are only three women on this list. In fact, there are more CEOs named Scott or Micheal than there are women on this list. Although in 2023, the women make more than the Scotts and Micheals; a minor win for gender equity.
Of god and men: The mythology of CEOs’ supposed path to the top chair also doubles as justification for ever higher pay: that companies’ extreme pay packages are needed to attract top talent. The truth of the matter is much more mundane. Of the 100 highest-paid CEOs in Canada, 76 per cent of them weren’t parachuted directly into the CEO chair; they were promoted from within the company and had worked there for on average 21 years. In other words, they’d been with the same company for, on average, half of their career.
“These aren’t gods plucked from heaven requiring heavenly pay packages—they’re internal hires who spent the bulk of their career at a single company,” says Macdonald. “In other words, they are company men. The myths exist to justify extreme pay.”
The report finds two federal government initiatives—capping the stock option deduction and increasing the capital gains to 66 per cent—could make a difference: The proportion of CEO pay coming from stock options has since been cut in half. And thanks to the 2024 change, the top five stockholders on the top 100 CEO pay list will owe $829 million more in income taxes because capital gains are taxed slightly more like working income.
—30—
Company Men: CEO Pay in Canada, 2023 can be found at policyalternatives.ca/news-research/company-men. For further information, please contact Amanda Klang, CCPA senior communications specialist, at [email protected].
Read full report
