Last August, the SEC began requiring most public companies to disclose the relationship between named executive officer (NEO) compensation – which notably includes any “perks” received by the executive – and the company’s performance. In addition, this new rule requires companies to list at least three, and up to seven financial performance measures that it ties to NEO compensation.
Due to the way the rule is written, most 2023 proxy statements contain NEO data – which coincidentally includes a pay versus performance matrix that covers the company’s last five fiscal years.
With that in mind, this week we dive into the world of the S&P 100’s named executive officers – all 479 of them. What did we find? Well, despite the lack of a Mr. Anderson, or anyone named Smith, there’s a wealth of information about the roles, compensation, performance – and diversity – of these titans of industry peppered throughout 2023’s proxies.
Before you take the red pill and read on below, note that NEO designations are always a look back at the prior fiscal year. That means every statistic and data point below may not be exactly true as of today. Also worth noting, we count NEOs from the Middle East and North Africa as separate and distinct from White, the racial category they’re often lumped into.
How many named executive officers do S&P 100 companies disclose?
- Almost all S&P 100 companies disclose having either five or four NEOs. That said, outliers exist. On one end of the spectrum are JPMorgan Chase, Walmart, Netflix, and Amazon, which each have six NEOs, while four companies – Starbucks, Coca-Cola, Oracle, and Tesla – disclose only three. Tesla, for example, lists only Elon Musk, CFO, Zack Kirkhorn, and SVP Andrew Baglino, who leads Tesla’s powertrain and engine engineering unit.
- One member of the “above and beyond” category, Walmart, specifically addresses its gaggle of NEOs in its latest proxy (Walmart Inc. CEO Doug McMillon, CFO, John Rainey, CTO Suresh Kumar, Walmart U.S. CEO John Furner, Walmart International CEO Judith McKenna, and Sam’s Club CEO Kathryn McLay). Sam’s Club is a division of Walmart Inc., but the company chose to “voluntarily” include Kathryn McLay, because “it [helps] provide shareholders with information about how our compensation plans are designed to incentivize and support each operating segment.”
- Another company that discloses six NEOs, JPMorgan Chase, is also the only one with a trinity of female NEOs. One is Mary Callahan Erdoes, CEO of J.P. Morgan Asset & Wealth Management, and the other two are Marianne Lake and Jennifer Piepszak, Co-CEO’s of the company’s consumer and community banking operating segment. Notably, Marianne and Jennifer’s equal titles and compensation structure led to JPM’s higher NEO count.
- In addition to JPMorgan Chase, only two other companies have an equal number of male and female NEOs. Specifically, Walt Disney discloses data for CFO Christine McCarthy and Chief Communications Officer Kristina Schake, while Walgreens Boots Alliance does so for CEO Rosalind Brewer and COO Ornella Barra.
How diverse are the S&P 100’s named executive officers?
- That said, 33 companies disclose having all male NEOs. This list includes Verizon, BlackRock, Mastercard, FedEx, Coca-Cola, Tesla, Boeing, Ford, and many others.
- Overall, only 92, or 19% of S&P 100 NEOs are women. Within that small group, only six, or slightly more than 1%, identify as Black or African American, including Dow president Karen S. Carter, McDonald’s GC Desiree Ralls-Morrison, Home Depot EVP Ann Marie Campbell, and Walgreens’ CEO Rosalind Brewer.
- In the world of NEOs, two Hispanic women stand apart – Cisco COO Maria Martinez, and Intel EVP Sandra L. Rivera.
- On the issue of racial and ethnic diversity, the world of S&P 100 NEOs is overwhelmingly White (79%). Asian Americans make up the next highest ethnic concentration of NEOs (10%), followed by Black and African Americans (4%), Hispanic and Latinos (4%), and those from the Middle East and North Africa (2%).
- Only eight companies disclose a group of NEOs that is 50% or more diverse (including executives from the Middle East and North Africa). Emerson Electric tops this list with three racially or ethnically diverse NEOs (three out of four, or 75%), while Starbucks, AMD, Citigroup, Kraft Heinz, Adobe, Linde, Broadcom, and CVS all disclose having between 50 and 67%.
- Finally, of the 479 NEOs we’re tracking, only three (less than one percent) self-identify as LGBTQ+. Two are from Apple – CEO Tim Cook and Deirdre O’Brien, head of people and retail – and the other is Dow CEO Jim Fitterling, who came out to Dow employees in 2014 and believes “no one should be afraid to bring their whole self to work.”