High CEO pay shatters previous records in Canada

Canada’s 100 highest paid CEOs made 227 times more than what the average worker made in 2018, according to a new report from the Canadian Centre for Policy Alternatives (CCPA). That’s more than the 197 times average worker pay in 2017. 

The report shows that the country’s highest paid 100 CEOs on the S&P/TSX Composite index made about $11.8 Mn in 2018. Thus, beating 2016’s record high of $10.4 Mn. The average worker pay rose by just 2.6 percent between 2017-18 while the CEOs pay rose by 61 percent during the same time period. 

“Growth in the vast gap between excessive CEO compensation and average incomes is an indicator of Canada’s income inequality juggernaut,” said David Macdonald, Senior Economist, CCPA. “Wealth continues to concentrate at the very top while average incomes barely keep up with inflation.” 

The “minimum wage” a top-100 CEO needed to make the list is $6 Mn annually and about 79 percent of the average CEO’s pay in 2018 came from bonuses related to company stock prices.

According to the report, only four women are among Canada’s richest 100 CEOs, up from three last year. 

“The federal government needs to reckon with the runaway C-suite compensation that is contributing to Canada’s growing income inequality gap,” said Macdonald. 

It is interesting to note that when companies lose money, executive pay remains high. A review of tax loopholes with a focus on the preferential treatment of stock options and capital gains can help address the excessive CEO pay.