As the role of the top legal officer at public companies continues to evolve, median total direct compensation (TDC) has increased 6.7%, according to the Equilar & BarkerGilmore General Counsel Pay Trends 2018 report. The report examines the 500 largest (by reported revenue) U.S.-headquartered companies that trade on one of the three major U.S. stock exchanges (Nasdaq, NYSE, or NYSE American).
When analyzed by revenue to identify variances, General Counsel (GC) at companies with less than $5B in revenue received the largest percentage increase of 21.8% from fiscal years 2016 to 2017, or a median $2M in total compensation. Comparatively, GCs at companies reporting $5B to $10B in revenue experienced a 3.3% decrease in total compensation to $2.0 million. GCs at companies with revenue between $10B and $20B evidenced a 6.6% increase in median pay to $2.7M, while those on the highest end of the revenue spectrum with more than $20B, saw a pay increase of 0.9%, or a median of $4.5M in 2017.
Observing the quickly changing role of today’s GCs, Robert Barker, Managing Partner at BarkerGilmore, commented: “As the General Counsel role expands beyond the traditional legal, compliance, and governance functions, compensation continues to increase accordingly. Also worth noting is that compensation for GCs who have been in the role for five years or less are often exceeding those with long tenure with one employer. This can be partially attributed to new hires negotiating higher compensation than that of their predecessor and partially to the change in the role meriting higher compensation.”
“CEOs expect the General Counsel to bring a heightened level of gravitas, persuasive communication, and assertiveness to the table, more so now than in the past,” said John Gilmore, Managing Partner at BarkerGilmore. “The GC is a spokesperson for the company and those lacking the ability to effectively communicate will not be successful in the recruiting process. Therefore, compensation is being driven up, paying more to those GCs who are performing at this higher level.”
Other noteworthy highlights from the recently released report include:
- The median stock award given to a GC in companies between $5B and $10B is more than twice as large as that of companies with less revenue.
- In 2017, salary was the largest part of the compensation package for GCs at companies generating less than $10B in revenue.
- The median TDC for GCs at Equilar 500 basic material companies experienced the largest increase of over 27.6%, followed by healthcare with an increase of 25.6%.
- Conversely, GCs at utility companies experienced the most significant decline of 16.3% and financial services had a decline of 6%.
- The median for all Equilar 500 industry sectors changed 6.7% from the 2016 median.
We invite you to download the entire 2018 Equilar & BarkerGilmore General Counsel Pay Trends Report here.
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