Good morning!
Who wants to be the top dog in corporate America? Not as many people as previously thought.
Fewer C-suite executives are aspiring to become CEO these days, Fortune’s Geoff Colvin writes. And while factors like the increasing difficulty of the job—managing unruly employees and growing discontent in the public eye—may contribute to executives passing on the opportunity, Colvin writes that one “little-noticed significant factor” is money.
While the average CEO’s pay has skyrocketed in recent years, that of other C-suite executives, including CHROs, has increased even more.
“There’s less financial incentive to be a CEO,” says Laszlo Bock, former HR chief at Google and cofounder of Humu, a maker of HR-related software. “The compensation of the layer below the CEO has risen at a higher rate than the CEO.”
Even CHROs, who tend to make the least of their C-suite counterparts, “may be making $8 million” annually at the biggest companies, says Bock. That figure is not the norm, although pay packages for HR chiefs have surged thanks to greater demand for the executive role—and its elevated stature.
The median compensation for HR chiefs at the 500 largest U.S. publicly traded companies grew by almost 13% to $2.2 million in 2022, according to an Equilar analysis of HR executive pay trends. The communication services sector offered the most extensive median HR pay packages at $2.9 million, while the energy sector gave the lowest at $1.2 million.
Meanwhile, companies with over $30 billion in revenue awarded HR executives a combined median pay of $3.3 billion.
Though today's executives receive sizable financial rewards for their ability to deal with new paradigm shifts and, in many instances, are satisfied with their current pay, Colvin points out that “plenty of energetic strivers will still fight to be CEOs.” HR chiefs are emblematic of that.
As my CHRO Daily predecessor Amber Burton wrote last year, CHROs are increasingly contenders for the top job. But that trend may slow if their pay continues ticking upward and they, like their C-suite peers, lose interest in snagging the corner office.
Read the full story here.
Paige McGlauflin
paige.mcglauflin@fortune.com
@paidion
