According to "Recession-Proof: Canada's 100 best paid CEOs," a report published by Hugh Mackenzie, this was a great year to be a CEO despite the downturn in the Canadian economy in 2009. The report notes that based on the previous compensation patterns "on January 3  the average of the 100 best-paid public company CEOs in Canada already pocketed what it would take a Canadian working full-time, all year to earn."
Assuming that the average CEO of Canada's top 100 compensating companies works 80 hours a week, 52 weeks a year, the hourly wage for top executives amounts to approximately $1,600/hour.
IN PICTURES: How To Make Your First $1 Million
Top Paid CEOs
Below are the top paid Canadian CEOs in 2009 based on base salary, bonus, sharers, options, pension benefits and other forms of compensation as determined Hugh Mackenzie.
|CEO||Company||Total Compensation||2010 Return|
|Aaron Regent||Barrick Gold (NYSE:ABX)||$24,217,040||30%|
|Hunter Harrison||Canadian National Railway (NYSE:CNI)||$17,343,160||25%|
|Gerald Schwartz||Onex (TSE:OCX)||$16,689,758||27%|
|Edmund Clark||TD Bank (NYSE:TD)||$15,188,391||18%|
|Nadir Mohamed||Rogers Communication (NYSE:RCI)||$13,687,699||15%|
|Fred George||Gammon Gold (NYSE:GRS)||$13,061,177||-30%|
|Edward Sampson||Niko Resources (TSE:NKO)||$12,949,343||7%|
With the Canadian stock market improving 18% in 2010, as measured by the iShares MSCI Canada Index ETF (NYSE:EWC), there is one company that immediately draw my attention: Gammon Gold, which lost 30% of its value. Although CEO compensation is usually indicative of past corporate performance, high salaries should be awarded to those who can improve the operations of a company on an ongoing basis; however, Gammon Gold significantly underperformed the broad Canadian market. Why?
In late 2009 CEO Fred George announced his retirement after 14 solid years with Gammon Gold. As co-founder of the corporation, he helped guide the company from a small exploration firm to one of the largest precious metal producers in Mexico. Upon retiring, George was given equivalent to 36-months of compensation and all of his outstanding option positions fully vested.
Under new management, Gammon has experienced mixed results, potentially due to big bath strategies. Despite that year-over-year revenues have been increasing, earnings continue to disappoint. In their first quarter results, for example, despite a 175% rise in EBIT, foreign exchange losses significantly contributed to a 50% EPS decrease. Likewise, in the second quarter an impairment charge of $220,610,000 was realized as mining operations at the El Cubo mine were suspended due to labor disputes and rising costs.
The Bottom Line
In contrast to a regular, Canadian, full-time worker who earned slightly less than $43,000 a year, the top 100 CEOs brought home an average salary of $6.6 million. Even Michael Waites, CEO of Finning International (TSE:FTT.TO) who finds himself at the bottom of the list earned a staggering $2,967,000. For those of us wanting to become millionaires, becoming CEO of a major company seems to be the way to go. (Think you have what it takes to be chief executive? Find out what those at the top have in common. Check out Becoming A CEO.)
Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!
Mutual Funds & ETFsLearn about arbitrage funds and how this type of investment generates profits by taking advantage of price differentials between the cash and futures markets.
Investing NewsWill Ferrari's shares move fast off the line only to sputter later?
Stock AnalysisHere are five stocks that pay safe dividends and should be at least somewhat resilient to a bear market.
InvestingThe further you fall, the harder it is to climb back up. It’s a universal truth that is painfully apparent in the investing world.
Fundamental AnalysisOptions market trading data can provide important insights about the direction of stocks and the overall market. Here’s how to track it.
Stock AnalysisCan these two oil stocks buck the trend?
Investing NewsAlcoa plans to split into two companies. Is this a bullish catalyst for investors?
Stock AnalysisIf you want to buck the bear market trend by going long on consumer stocks, these three might be your best bets.
Investing NewsA rate hike would certainly alter the investment scene, but would it be for the better or worse?
Investing NewsWith market volatility high, you may think it is time to run for corporate bonds instead of stocks. Before you do take a deeper look into which is better.
When a company issues a cash dividend to its shareholders, the retained earnings listed on the balance sheet are reduced ... Read Full Answer >>
The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>