Senior executive compensation—along with almost everything else in the economy—has endured some twists and turns in recent years. Chief Executive’s CEO and Senior Executive Compensation Report for Private U.S. Companies is there to shed light on recent changes to compensation in private companies, where very little information is available. Among the most interesting information our research reveals is the compensation patterns for different executives in the C-Suite—most notably, high median increases to base salary in recent years that had historically hovered at 0 percent, rarely surpassing 2 percent.
For example, the rate of CFO base salary increases has matched or surpassed that of chief operating officers and chief sales officers since at least 2017, according to our data based on thousands of companies over the years—and 2022 is no different. Since Covid-19 wreaked havoc on most businesses’ checking and accounting books, CFOs emerged as even stronger key players in the C-Suite. Often, their creative financial solutions kept the cash flowing while revenues stalled. In return, when revenues resumed in 2021, CFOs received a median raise of 3.25 percent to their base salary.
Meanwhile, COOs and CSOs only saw a 2.75 percent increase in their base salary over the same time period, although they received a 0.25 and 3.25 percent boost to their bonus, respectively. (For CSOs this can be attributed to a boost in sales when coming out of Covid.) Even into 2022, CFOs earned a high boost to their base salary, at a rate of 3.64 percent at the median, compared to 2.44 percent for COOs and 2.46 percent for CSOs. Despite smaller raises to base salary for COOs and CSOs than for CFOs, these are still some of the largest median overall base salary increases that we’ve seen in our research.
Historically, the median change in base salary tends to hover around 0 for executive base salaries in private companies, including the CEO. Before 2021, the highest median increase to base salary for CFOs was in 2017 at 1.75 percent. Similarly for COOs, their highest median increase to base salary was in 2017 at only 0.25 percent. CSOs saw a median change in base salary of 0 percent between 2017 and 2020. And while CSOs and COOs saw their peak median base salary increase in 2021, CFOs’ hit another high in 2022.
So, what exactly does that measure out to in dollar terms for cash compensation? Well, COO is still the highest compensated position in the senior executive suite, bringing home $260,000 in cash compensation in 2022, including a median base salary of $205,000 and an expected median bonus of $55,000, across all private companies. (Respondents were asked about their expected bonus in 2Q22, before many turns in the market, we expect bonuses paid out will be slightly lower.) CFOs didn’t fall far behind, bringing in $250,000 at the median level overall, $200,000 in base salary and $50,000 in bonus. CSOs are another $10,000 below them, with a median overall cash compensation of $240,500 in 2022.
Of course, compensation is based on more than just the year and title. Base salary and bonus can vary by tens of thousands of dollars depending on the industry or revenue range of the company. If you want to know more about CEO and senior executive compensation plans and figures, read our report on 2022-2023 CEO and Senior Executive Compensation in Private U.S. Companies.
Change in CFO Base Salary by Company Size and Industry
The most influential driver of senior executive compensation is company size in terms of annual revenues. When it comes to CFO compensation in 2022, well, they did good. The median CFO received a raise across all company sizes—not necessarily true in other titles. At the top quartile, no CFO saw a raise below 6.2 percent.
When examining CFO base salary change by industry, we see that CFOs at consumer manufacturing companies received the highest median increase to their base salary in 2022, at 5.3 percent. Industrial manufacturing and architecture/engineering were the other industries doling out high median raises in 2022 to their CFOs, at 5 and 4.2 percent, respectively.
At the top quartile, CFOs in consumer manufacturing still saw a boost to their base salary above the rest, with those in wholesale/distribution coming in at close second, earning 10.2 and 10 percent more in 2022 than the previous year, respectively. CFOs in financial services came in third, with a top quartile increase of 9 percent to their base salary in 2022.
Want to know exactly how much the CFO at a financial services partnership with $25 million in revenues earns? Read our report on 2022-2023 CEO and Senior Executive Compensation in Private U.S. Companies to learn exact figures, benefits and perks, equity numbers and more.
