WrapPRO’s annual executive compensation survey finds that not everyone who took COVID pay cuts made less money in 2020
Taking a pay cut during the pandemic meant something very different for Hollywood and tech CEOs than for the rest of us.
Last year, while the pandemic was spiraling out of control and bludgeoning the industry’s bottom line, many media companies like Fox, Comcast, Disney and struggling movie theater chains like AMC and Cinemark put out slick press releases about how their top execs were cutting – or in some cases forgoing – their salaries to help weather the financial storm.
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Now that we’re in 2021, we can see just how their pockets were affected, or not. In a word, CEOs were all still more than handsomely compensated for their work last year. For most, the pay cuts only meant they weren’t taking their salaries, which is a small fraction of their full compensation packages, mostly made up of stock and option awards, as well as bonuses.
While it is true that the top executives over at Fox, Comcast and Disney did make less money compared to 2019, others actually saw their pay increase despite lower salary. AMC’s Adam Aron and Cinemark’s Mark Zoradi each saw their total compensation jump in 2020 — which doesn’t look great when you consider that 2020 was a brutal year for the movie theater industry, taking billions in losses. Aron was gifted with a $3.75 million bonus for “extraordinary efforts” for steering the chain through the pandemic (this came at the same time AMC said it took a $1 billion loss during the last three months of 2020.
Zoradi’s stock awards nearly doubled during 2020, which more than made up for his salary being cut from $1 million to $740,000.
Dish Network chairman Charlie Ergen saw his compensation go up 40-fold, from $2.36 million in 2019 to $94.7 million. The massive rise was due to an option award worth a whopping $91.9 million. If you take that out, his pay would still have been an 18.6% improvement from 2019, with $2.8 million.
Analyst James Reda, director and practice leader for executive compensation at Gallagher, told TheWrap that despite the bad optics of CEOs taking big bonuses during pandemic furloughs, layoffs and declining stock prices, entertainment companies have a bottom line motivation for offering big bonuses to top execs to keep in place through a crisis.
“It’s a down payment on the future,” Reda said. “I think it’s a good idea to keep people around and to get them motivated and provide incentive.” He added that while shareholders may be looking at massive stock losses in 2020, without strong leadership “they could be bankrupt — zero.” And that’s not a good thing.
And, although “CEO of an Entertainment Mega-Conglomerate’ makes an attractive job description, one entertainment industry analyst told TheWrap that the risk-reward equation doesn’t always add up.
Take AT&T, for example. The company, which can boast a current market cap of $230.6 billion, saw a drop in its share price in 2020 from $35.14 to $28.76, or 18.16%, and AT&T owned WarnerMedia cut thousands of jobs beginning in October 2020.
The analyst said that the exponential growth of tech companies compared to entertainment companies makes tech jobs the more attractive arena. “To get someone to work at AT&T has to be a pretty big guarantee that they’re gonna win,” the analyst said. “So they end up overpaying these people.”
And taking over a high profile company puts an executive future and reputation at stake in more ways than one, the analyst said, because Hollywood business culture is going through its own high-profile reckoning in recent years. “There is so little managerial talent out there, and there are so many broken CEOs for sexual misconduct,” he said. “So the good guys are getting paid big.”
Huge compensation for entertainment and media executives reflects a general trend in executive compensation in all areas of industry that began decades prior to the pandemic, experts say. Between 1978 and 2019 CEO compensation has risen 1,007.5% for CEOs compared with 11.9% for average workers. That means in 2019, CEOs of top companies were making 278 times the compensation of the average worker.
Below is TheWrap‘s list of executive compensation details from 2020 corporate SEC filings. To compare it to past years, click through our previous annual reports. (You’re welcome):
We will be updating this story as more major media companies report the take-home pay of their top executives.
Bob Bakish is among the media execs who made more money in 2020 than he did in 2019. If we’re being fair, with the long-promised rebranding of CBS All Access to Paramount+, he didn’t mail it in from his dining room table. Then again, 2019 wasn’t exactly a put-your-feet-up year for Bakish either, as that’s when Viacom and CBS were re-merged.
Last year, Bakish made a base salary of $3.1 million, an increase of six percent. The bulk of his compensation came from stock awards ($16 million) and non-equity incentive plan compensation ($19.6 million). It helped that ViacomCBS was not among the companies to institute pay cuts last year.
ViacomCBS saw its stock price drop from $23.2% from $40.32 to $37.16 from Jan.2, 2020 to Jan.2, 2021. The company has a current market cap of $25.4 billion.
Bakish and Netflix’s two CEOs (more on them below) were among the top 10 highest-paid CEOs for any business in 2020.
Our excuse for Bakish’s pay increase didn’t quite translate to David Zaslav, who geared up forever for the January 2021 launch of the Discovery+ streaming service. Zaslav’s options awards changed from $7 million in 2019 to nada in 2020. His pay dropped by nearly 18 percent.
But don’t feel too badly for the staunch defender of the cable bundle (weirdly, a bit less so since launching Discovery+), since the dude banked an insane $129.4 million in 2018, thanks to an enormous increase in Zaslav’s options award of almost $90 million that year.
In March 2020, Discovery drew down $500 million under the credit facility to increase its cash position and maximize flexibility in light of the current uncertainty surrounding the impact of COVID-19, according to an SEC filing. Also in the filing, Discovery estimated that its adjusted operating income would take a hit of $175 million to $200 million in the third quarter of the fiscal year. However, Discovery Inc.’s stock price actually increased slightly from Jan. 20 to Jan. 21, from $32.05 to $33.04, up 3%.
Cinemark CEO Mark Zoradi made $600,000 more in 2020 than in 2019, which feels a little odd because his theaters sure did not.
Due to a pandemic-instituted pay cut, Zoradi’s base salary decreased from $1 million to $740,000 and his non-equity incentive plan compensation went to zero. But his stock awards rose from $3.1 million in 2019 to $5.8 million in 2020, a year in which Cinemark stock did anything but rise, falling 36% over the course of the year (at one point it was down 74%).
That didn’t raise a whole bunch of red flags within the industry, however, because…
AMC Entertainment CEO Adam Aron’s dramatic 115% increase in compensation last year is glaring in the pandemic year. After all, AMC is the No. 1 theater chain in the U.S., and what business was rocked harder in 2020 than movies theaters? AMC Theatres lost $4.6 billion in 2020 due to pandemic closures, which have only recently started to reopen. The struggling theater chain, which at various times during the year sounded as if it wasn’t sure it would even make it to 2021, raised more than $900 million to stave off bankruptcy.
Aron took a small salary cut, but he received two bonuses totaling $5 million in 2020. And those aren’t the only two extra payments Aron received during the COVID-19 crisis. In March 2021, Aron received a bonus of $3.75 million from AMC’s board “to recognize the extraordinary efforts of employees to maintain the company’s business and preserve stockholder value during the COVID-19 pandemic, encourage continued engagement and retention, and incentivize our management and employees during the continuing and unprecedented difficult business conditions.”
In 2020, Aron also enjoyed a massive stock-awards windfall of $14.8 million. So far shareholders haven’t complained, but that might not last.
AMC Networks’ Josh Sapan saw one of the biggest pay decreases from 2019 to 2020 due to his stock awards sinking from $13.8 million in 2019 to $5.6 million last year. His pay fell nearly 42 percent.
Better call Saul. Or better yet, an employment lawyer.
Sapan’s decline in compensation was even worse than his company’s near-30% decline in profits over the same time period. Cord-cutting and the coronavirus pandemic has done a number on AMC Networks.
AMC Networks stock price dropped from $39.15 to $35.77, or 8.6%, in 2020. The company’s current market cap is just over $2 billion.
Roberts took a modest pay decrease in 2020 but still ranks among the highest paid of media CEOs. He even leapfrogged Lachlan Murdoch (who out-earned him in 2019) with $32.7 million. Roberts’ base salary was $3.4 million, but he donated the portion from April through September to COVID-19 relief charities. (So you don’t have to do the math: That was about $1.7 million.)
To soften the pain of that decline, Roberts’ stock awards last year totaled $10.6 million, double his 2019 haul.
Comcast’s NBCUniversal was among the many companies that instituted pay cuts for higher-ranking executives as protection against the many unknowns of COVID, which for NBCU and its parent Comcast primarily affected its theme parks and movie distribution. For Roberts and his lieutenant Jeff Shell, they went the donation route instead of giving up the salaries outright.
Comcast saw an increase in share price from $5.36 to $51.36, or 13.2%, in 2020. It has current market cap of 269.5 billion.
Shell pulled in $16.5 million for his first year as CEO of NBCUniversal, which like Disney’s Bob Chapek came amid the worst of circumstances. It was even worse for Shell, who himself contracted COVID-19 early on in the pandemic.
Shell donated $1.25 million of his base salary of $2.6 million to COVID-19 relief charities.
Shell’s stock awards were $3.7 million, while his option awards round up to $3.8 million.
Fox Chairman Rupert Murdoch and his son Lachlan (more on him below) both made significantly less money in 2020 than in 2019. Lachlan made a lot less money than his dad did; the elder Murdoch still made more than $30 million, a massive salary considering how much smaller the current Fox is from the company he sold to Disney two years ago.
The current iteration of Fox, which the Murdochs own 39% of via their family trust, includes Fox Sports, Fox News and the Fox broadcast network, as well as streaming service Tubi. The company did just buy Clay Travis’ sports media company Outkick to help with its growing sports betting business.
Both Murdochs decided to forgo their salaries between May and September to help the company weather the effects of the pandemic. But Rupert’s base salary was still more than double most other media CEOs, at $4.2 million.
Lachlan Murdoch, who gets the fun job of actually running the company – which also means taking the brunt of the criticism against Fox News, though he doesn’t seem to be sweating that too much – saw his pay decline by more than 30% in 2020.
The younger Murdoch’s base salary dropped from $3 million last year to $2.5 million.
Fox Corp.’s stock price dropped from $37.41 to $29.07, or 22.3%, in 2020. The current market cap is $$21.6 billion.
More subscribers coincided with more bucks for Netflix co-founder and co-CEO Reed Hastings last year. Netflix added a company-record 37 million new subscribers in 2020, thanks in large part to the pandemic fueling what the company called a “pull forward in demand.”
In other words: Netflix was well-positioned to capitalize on having millions of people stuck inside with little to do. However you put it, those new subscribers helped Netflix’s stock price jump 65% in 2020. That didn’t hurt Hastings, who received the bulk of his 2020 earnings — about $42.43 million — from stock options. Overall, his 2020 pay jumped 12% to $43.2 million.
Netflix’s longtime chief content officer added the co-CEO title midway through last year, and he also added a few extra millions to his bank account in the process. Sarandos’ pay package increased 13% last year to $39.3 million, with a little more than half of that coming via his $20 million salary.
He earned another $18.3 million in stock options, and, perhaps most interestingly, Sarandos received nearly $1 million last year for home security costs. Like Reed Hastings, Sarandos’ pay package increased as Netflix enjoyed a big 2020, finishing the year with 203.6 million subscribers.
It’s no secret that Netflix saw big gains in 2020 as media-hungry shelter-at-homes gobbled down their content. The stock price jumped from $329.81 to $540.73 during 2020. Its current market cap is 218.7 billion.
Disney executive chairman Bob Iger became the poster child for pandemic giveback in 2020, forgoing his salary for a portion of the year in a public gesture presumably designed to take the sting out of massive pandemic layoffs of Disney workers which totaled 32,000 by mid-2021.
Iger, who began 2020 as Disney CEO and became executive chairman in February to make way for new CEO Bob Chapek, also went without planned bonuses during COVID-19. Iger ended up making just under $1.6 million in salary for fiscal 2020, down from the $3 million earned in 2019. His reported stock awards declined from more than $10 million in 2019 to less than $7 million in 2020. Iger added another $1.8 million under the pension/deferred compensation heading, and $1.2 million in the catch-all category “All Other Compensation.”
Disney CEO Bob Chapek, who gave up half his salary as well as forgoing bonuses during the pandemic, drew $1.8 million in salary, had $6.1 million in stock awards and $3.4 million in options. He added on a $2.7 million via a change in pension/deferred compensation and about $140,000 under that “other” column.
Like Shell above, we don’t know what this Bob made in 2019, when he was running Disney’s theme parks division. That’s because the SEC only requires companies to list their CEO, CFO and the next three-highest earners. And Chapek didn’t make the cut until he was promoted to CEO.
Even with the two Bobs forgoing significant portions of their compensation, Disney caught flak in 2020 for laying of 32,000 workers, mostly from its parks and cruise operations. And despite losses due to park closures, Disney’s stock price rose from $148.20 to $181.18 in 2020, although the share price dipped alarmingly during the first days of pandemic shutdowns, with the share price dropping to a low of $85.8 in late March 2020. Disney’s current market cap is $218.7 billion.
AT&T CEO John Stankey’s base pay in 2020 was just over $2 million, with stock awards totaling $13.4 million. In total, he took home just over $21 million. The amount was down slightly from the $22.5 million he earned in 2019, his last full year as WarnerMedia CEO. However, despite his promotion to AT&T chief, Stankey actually asked for the 2020 salary cut to help the company as it fought its way through huge pandemic losses.
Randall Stephenson, who formally retired as executive chairman in January, joined Stankey in requesting a salary reduction for the second half of 2020 in light of “unprecedented uncertainty and global economic stress” due to the pandemic according to an SEC filing. The reductions brought Stephenson compensation for six months as chairman to $29.2 million.
Jason Kilar and John Stankey shared a big job in 2020: Former The former Hulu chief Kilar came to AT&T Inc. last June as chief executive of AT&T’s WarnerMedia, succeeding Stankey, who in 2019 had also added the title of chief operating officer to his title.
At that time, it was announced that Kilar would report to Stankey, who was promoted to president and CEO of parent company AT&T, replacing Randall Stephenson, who retired from the post. But in money terms, Kilar was the boss in 2020, raking in $52.1 compared to Stankey’s $21 million, making Kilar the top-paid executive at the company.
Kilar’s $1.7 million salary for the half-year was a somewhat less than Stankey’s total 2020 salary of $2 million — but AT&T offered Kilar a stock award worth $49 million to lure him to the company almost concurrently with the May 27 launch of its streaming service, HBO Max. However, the $49 million will be paid out over four years, making the whopping 2020 figure somewhat misleading.
The bad news for Dish Network Chairman Charlie Ergen: His base salary dropped from about $1 million to $888,462 last year. The good news: He more than made up for that with a giant option award worth $91.9 million.
That’s a 3,845% jump in pay, fueled almost entirely by that one-time stock option. The massive option was because Ergen had a 10-year equity incentive compensation plan that began in 2011 (that was subject to free cash flow and subscriber targets) that ended earlier this year.
Overall, he brought home $94.7 million in 2020 — which was nearly 40 times more than he did the year before.
Even without that massive option, his compensation would be $2.8 million, which while more in line with recent years would still have been an improvement from 2019. That other increase comes from the catch-all “All Other Compensation” which for Ergen was $1.7 million for use of the company aircraft, and another $233,00 for “tax preparation” services.
It wasn’t as successful a year for Dish Network’s shareholders, though, with the company’s stock price dropping a little more than 12% in 2020 from $35.74 to $32.34. Dish closed 2020 with 11.3 million paying customers, down from 12 million at the start of the year. Current market cap for the company is $24.2 billion.
Apple’s head honcho earned $14.8 million in 2020, up nearly 28% from the year prior. Arguably, he deserved it.
The world’s biggest company — with a market cap that crossed $2 trillion last year and hit $2.13 trillion by year’s end– weathered the pandemic better than most, with Apple reporting record Mac and Services sales last year.
Apple also sold 80 million iPhones during the holiday quarter, proving that interest in its signature device remains robust. It wasn’t all roses for Cook, though, as he’s had to spend more time over the last two years grappling with the increased scrutiny Big Tech faces from regulators in the U.S. and abroad.
In a year defined by change, things were actually pretty consistent for Amazon CEO Jeff Bezos in 2020. Bezos earned $1.7 million last year, which was unchanged from the year before, right down to the same $81,840 salary. The bulk of his compensation stemmed from security costs, and he didn’t receive any stock awards.
But don’t worry about Bezos and his relatively “modest” 2020 compensation — he’s still worth $193 billion, making him the world’s wealthiest person (although he’s had to battle Tesla/SpaceX CEO Elon Musk for that crown over the last six months).
Apple’s current market cap tops $1.6 trillion.
To catch up on all our past executive compensation surveys, check them out here: