Extrapolating GC compensation from the top five compensated executives

Publicly-traded companies in the US must disclose each year the compensation of their five highest-paid executives. What those executives make in base, bonus, stock options, restricted stock grants and otherwise is all laid out in tables. It’s fairly easy to use that data, when compiled for general counsel in an industry along with who belongs in the top five, to estimate the compensation of a general counsel who is in the industry but not in that quintet.

As an example, for the general counsel of a bank I took the publicly-available data from those banks whose top legal officer was in the five-most highly compensated group. From the data on CEO base pay and the other executives’ base pay, I could calculate trend lines. Since we knew my client’s top executives’ compensation, we could come close to what his base pay should be in light of the medians of the other available data.

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