They’re not Hollywood stars, they’re not TV personalities and they don’t play in a rock band, but their pay packages are in the same league.
Six of the 10 highest-paid CEOs last year worked in the media industry, according to a study carried out by executive compensation data firm Equilar and The Associated Press.
The best-paid chief executive of a large American company was David Zaslav, head of Discovery Communications, the pay-TV channel operator that is home to Shark Week. His total compensation more than quadrupled to $156.1 million in 2014 after his contract was extended.
Les Moonves, of CBS, held on to second place in the rankings, despite a drop in pay from a year earlier. His pay package totaled $54.4 million.
The remaining four CEOs, from entertainment giants Viacom, Walt Disney, Comcast and Time Warner, have ranked among the nation’s highest-paid executives for at least four years, according to the Equilar/AP pay study.
One reason for the high level of pay in the industry is that its CEOs are dealing with well-paid individuals.
“The talent, the actors and directors and writers, they’re being paid a lot of money,” says Steven Kaplan, a professor of finance at the University of Chicago Booth School of Business. “In industries where the talent makes a lot of money, the CEO makes a lot of money as well.”
Pay packages for CEOs overall grew for the fifth straight year in 2014, driven by a rising stock market that pushed up the value of executive stock awards. Median compensation for the heads of Standard & Poor’s 500 companies rose to a record $10.6 million, up from $10.5 million the year before, according to the Equilar/AP pay study.
Peer pressure is another factor driving up executive compensation. The board members responsible for setting CEO pay typically consider what the heads of similar companies earn. If pay for one goes up, it will likely go up for others.
The gap between pay for CEOs and that of the average worker narrowed slightly last year, because average wages crept up more than CEO pay did.
A chief executive made about 205 times the average worker’s wage, compared with 257 times the year before, according to AP calculations using earnings statistics from The Labor Department. That gap was still much wider than six years before, during the recession, when executives earned 181 times the average worker’s pay.
