The average chief executive of an S&P 500 company takes home $19m a year—285 times the pay of the average worker. By 6.44am on January 2nd, a typical CEO has already earned what a typical employee makes in an entire year.
In 1992, S&P 500 CEO pay averaged $4m. It has nearly quintupled since then, vastly outstripping the one-third rise in average worker pay over the same period. The median S&P 500 firm was worth $3bn in 1992; by 2026 it was $40bn.
The economic logic behind rising pay rests on scalability: a CEO's decisions affect the entire organisation, and the bigger the firm, the larger the impact. Rising pay linked to scalability is not unique to chief executives—anyone with scalable talent, including athletes, actors, musicians and influencers, is paid far more today relative to the average wage than in the past.
Research shows that chief executives who own a substantial fraction of their firm's shares deliver four to ten percentage points higher annual shareholder returns than poorly incentivised peers—a causal relationship, not merely a correlation. Many executive-pay packages rely on discrete performance thresholds that create perverse incentives, encouraging bosses to manipulate short-term performance to clear arbitrary hurdles. Incentives to promote diversity, equity and inclusion often end up rewarding demographic box-ticking rather than genuine inclusion.
A quarter of large American firms faced meaningful opposition to their remuneration reports in the 2025 say-on-pay vote. The most prominent controversy was Tesla's package for Elon Musk, which could be worth up to $1trn.
The very ink with which all history is written is merely fluid prejudice.