...because most top executives also receive a bonus – worth on average 157 per cent of their salary last year. That is 10 to 15 per cent higher than the previous year. Many also receive long-term stock awards that can be worth up to 165 per cent of salary if performance targets are met.
That means executives can now, on average, quadruple their salary if they scoop up all the available incentive pay. Compare that with the early 1990s, when incentive plans were rarely worth more than double the annual salary.
And as the Patterson Associated research I posted previously indicates, if your LTIPs don't pay out you can usually rely on the remuneration committee (advised by the likes of... errr... Deloitte) to bung you a bigger bonus to make up for it.