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GCs who report to the CEO are paid more, and a few thoughts on reasons why

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Recent data has appeared on general counsel among the Fortune 250 who do or don’t report to the CEO as well as the compensation differences between the two groups. The analysis comes from Equilar by way of a summary in Inside Counsel, Jan. 2010 at 42.

A graphic shows that 204 general counsel of the Fortune 250 report to the CEO while 61 do not. (I know, that totals 265 general counsel in the group of 250 companies.) The difference in their median total compensation favors direct reports by a whopping 40-50 percent ($1.3 million vs. $880,000).

What really surprises me is the number of GCs who do not report to the CEO. Almost one out of three must then report to the President, chief operating officer, or another senior executive. It follows that their total compensation would be lower, generally speaking, than “higher ranking” direct reports. The non-direct reports may also be younger and with less experience than the direct reports. Direct reports may also lead more functions, such as communications, compliance, internal audit, risk management. Still, the enormous compensation gap leaves questions unanswered.

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One response to “GCs who report to the CEO are paid more, and a few thoughts on reasons why”

  1. Richard Y. Cheng says:
    May 25, 2010 at 10:16 am

    I am very surprised by such a great disparity in incomes. GCs who report to another individual who is not the CEO may be doing so in another capacity. At my company, I am the GC, but I am also the VP of Clinical Reimbursement/Ops (partly because I assist with Medicare appeals and often times it goes to an Admin. Law Judge), so in that capacity, I report to the COO. In the end, all my “legal” functions has a direct report to the CEO, but I do have a dual reporting system.