Collected Salary Surveys

Attached is an updated and very incomplete collection of salary surveys. I’ve added a few new articles, and a new section on lobbyists & trade association CEOs (not many articles to fill it, yet).

As before, the list is spotty, and the information varies in relevance, but I’ve put it in Word format with a scrollable table of contents so you can make and update your own copy.

No need to print off this documents to use it—just move the mouse over any item in the table of contents, then <ctrl> <click> and you’ll be taken to the article. You can also do frames: go into format, select frames, and then choose table of contents in frames.

The quality of the surveys is uneven: Inaccuracies, misleading tables, poor formatting—it’s all in here. I’ve always meant to at least highlight the relevant information . . . best intentions, etc.. . . and, little by little, I may even do it.

There are still large gaps in coverage. If you have anything to fill in the missing holes, I would be very grateful.

General Fat Cat

15 Highest Paid Women in

U.S.

Ann Harrington
405 words
Fortune 13 October 2003

110
Copyright (c) 2003 Bell & Howell Information and Learning Company. All rights reserved.

Does power equal big bucks? At Fortune's request, data analysis firm Equilar crunched total compensation numbers for the five best- paid executives at S&P 500 companies in the latest fiscal year-- and produced estimates of their total value over time. Sure enough, two-thirds of the 15 best-paid women are on our Most Powerful list. The top earner, Lucent CEO Pat Russo, made $38.2 million--twice as much as any of the others--largely because of a "golden hello" loaded with restricted stock and options. (Citigroup's Sallie Krawcheck got options worth $10.2 million last year but doesn't appear here because companies count only salary and bonus when ranking the top five.)

Equilar then compared the pay for the 2,120 male and 112 female execs who had been at their companies at least three years. A discouraging finding: The median comp of the women in this group-- $2.1 million--is 24% less than that of the guys. The highest-paid man in this group, PeopleSoft CEO Craig Conway, got a package valued at $112.1 million. Observes compensation consultant Graef Crystal: "It's very hard to find an overpaid woman." --A.H.

[1]Women not on FORTUNE's Power 50 list *Total compensation includes base salary, bonuses, restricted

stock awards, LTIP payouts, the value of option grants (calculated by Equilar using the Black-Scholes formula as of the grant date), and other compensation as disclosed in company proxies through Aug. 15, 2003. Jackwyn Nemerov of Jones Apparel Group and Adrienne Fontanella of Mattel were omitted from this chart because they no longer work for those companies. See also cover story of same issue Caption: COLOR PHOTO: ERIKA LARSEN Pat Russo

Investment Management, Finance & Accounting

Investment Manager Surveys

Fund managers, bankers serving rich get poorer-survey

Reuters

News, 08:33 5 December 2002
(c) 2002 Reuters Limited

By Elif Kaban
LONDON, Dec 5 (Reuters) - Private bankers and fund managers, accustomed to fat bonuses in the bull market, took home lighter paychecks this year with base salaries frozen and bonuses down to half of 2000's record levels, an industry survey showed. The survey by global headhunters TMP Worldwide said bonuses in 2002 in the fee-based industry will be 15 to 25 percent below last year's levels following a 2001 drop of 25 to 30 percent. For example, a British chief executive of a fund company with $25 billion of assets under management would see this year's bonus drop to $680,000 at the lower end from $850,000. "Firms generally have frozen base salary increases again this year especially for senior professionals," said the survey. "Hell will freeze over before they move again!" it quoted a senior human resources executive at a major mutual fund company as saying, referring to staff base salaries being reviewed. The survey said the pain was being felt in varying degrees with continental Europe likely to suffer smaller cuts than those in

Britain

and the

United States

due to the continent's fixed income focus. (see tables below). "The consensus, in most but not all cases, is that continental Europe and Asia outperformed investment management businesses in the

United States

and

Britain

," TMP said. Firms strong in retail distribution or a high net worth focus generally fared better than institutionally oriented ones.

STILL WITH A JOB, AND GRATEFUL FOR IT

Compensation in fund management and private banking has shrunk across the board as banks retrench in the downturn and axe thousands of jobs. Amidst wholesale layoffs, many investment professionals simply are grateful to still have jobs, TMP said. The global executive recruitment firm, with private banking specialists in New York, London, Los Angeles and Zurich, gave the following compensation data: (USD 000s)

INSTITUTIONAL MONEY MANAGEMENT - UNITED STATES:

TOP EXECUTIVES IN U.S. FIRMS WITH OVER $25 BILLION OF ASSETS
Level Base Bonus Incentive(*)
Chief Executive Officer 400-750 575-1,050 1,450-3,600
Chief Investment Officer 250-650 180-1,425 725-1,450
Chief Operating Officer 180-400 390-1,620 725-1,450
Head of Equity 350-500 475-1,075 250-725

(*) long term, includes restricted stock component of bonus and/or present
value of annual options grant

PORTFOLIO MANAGERS/ANALYSTS (USD 000s)
Level Base Cash Bonus
CIO-Major Product 250-550 180-1,800
Senior Portfolio Mgr-Value 250-325 600-4,500
Senior Portfolio Mgr-Growth250-325 450-2,800
Head of Equity Research 250-325 540-800
Head of Fixed Income 180-225 585-1,200
Senior FI Portfolio Mngr 150-180 245-1,275

SALES AND CLIENT SERVICE (USD 000s)
Level Base Cash Bonus
Head of Sales/Client Service 220-300 585-1,280
Senior Institutional Sales 125-200 245-450
Senior Client Service 125-200 135-225
Junior Client Service 80-130 55-155
Senior Client Portfolio Mgr 150-175 225-475
Junior Client Portfolio Mgr 80-130 90-160

INSTITUTIONAL MONEY MANAGEMENT - BRITAIN
TOP EXECUTIVES AT FIRMS WITH OVER $25 BILLION OF ASSETS
Level Base Cash Bonus Incentive
Chief Executive Officer 220-300 680-2,175 815-3,225
European CEO 200-275 725-1,600 350-1,250
Chief Investment Officer 175-275 375-1,150 875-1,750
Chief Operating Officer 175-210 150-200 600-1,100

PORTFOLIO MANAGERS/ANALYSTS (USD 000s)
Level Base Cash Bonus
Head of Equity-Major product 200-325 325-1,275
Senior Equity Portfolio Manager 125-210 100-200
Head of Equity Research 160-320 100-500
Equity Analyst 80-150 80-150
Junior Analyst 60-80 60-80
Head of Fixed Income 100-225 125-725
Senior Fixed Income Portfolio Mgr 100-175 55-150

INSTITUTIONAL SALES AND CLIENT SERVICE (USD 000s)
Level Base Bonus
Head of Europe/UK sales 145-215 145-1,000
Senior Institutional Sales 125-175 100-1,000
Senior Client Service 150-200 150-550
Junior Client Service 75-125 60-150

PRIVATE WEALTH MANAGEMENT - UNITED STATES
Level Base/Draw Bonus
Division Head 300-750 675-1,200
Investment Head 300-750 550-800
Senior Private Client Advisor 150-300 275-325
Junior Private Client Advisor 80-125 25-70
Asset Gatherer 100-200 30-40 pct of revenues
Senior Growth Portfolio Manager 150-200 80-245
Junior Growth Portfolio Manager 90-100 10-45
Senior Value Portfolio Manager 150-200 180-475
Junior Value Portfolio Manager 90-100 25-95
Fiduciary Professionals 115-145 20-70

PRIVATE WEALTH MANAGEMENT - BRITAIN
Level Base/Draw Bonus
Division Head 240-400 200-475
Senior Private Client Advisor 105-190 100-225
Junior Private Client Advisor 55-105 20 (guaranteed min)
Asset Gatherer 110-145 65-135
Portfolio Mgr-UK House 90-105 65-100
Portfolio Mgr-US House 130-145 115-145
Fiduciary Professionals 125-160 20-65

PRIVATE WEALTH MANAGEMENT - SWITZERLAND
Level European bank Swiss private bank US bank Cantonal bank
Senior relationship manager
Base 85-110 100-125 95-110 95-110
Bonus 90-110 100-145 80-100 110-160
Head of subsidiary/division
Base 145-185 125-175 155-185 135-175
Bonus 190-225 145-210 180-210 160-225.

Investment Banking Bonuses

’03 Big Spending In Bonus Season; Wall Street Workers Feel Benefits of Bull Market

Big Spending In Bonus Season; Wall Street Workers Feel Benefits of Bull Market Ben White
Washington Post Staff Writer
1,222 words
23 December 2003
The Washington Post
FINAL
E01
English
Copyright 2003, The Washington Post Co. All Rights Reserved

Step into Lever House, the super-hip new eatery on Park Avenue, and it's clear the Masters of the Universe are feeling bullish again.

It's bonus season on Wall Street. And people are partying, quite literally, like it's 1999.

Located a stone's throw from giant banks J.P. Morgan Chase & Co. and Citigroup Inc., Lever House has quickly become a favorite haunt of the Midtown Wall Street set. And unlike in recent years, when a brutal bear market dampened moods and thinned bankrolls, the folks who work in the neighborhood are living large, ordering bottles of wine and cote de boeuf ($76 for two) without a second thought.

"There is a sense of optimism that was not there in the last two years," said Lever owner John McDonald. During that hiatus, markets were down and so was investor confidence, hammered by a series of investigations of corporate wrongdoing.

Now, with markets moving up again, McDonald said, his private dinning room has been booked for lunch and dinner almost every day for the past two months, as Wall Street firms celebrate a return to healthy profits and reward their top performers.

"There is a sense of confidence. . . . Where you really see it is in the wine list. People are going on tasting journeys. They will start with a burgundy, move to a Bordeaux, then to a dessert wine. That's how you know people are getting serious again."

Overall, Wall Street bonuses will be up 20 to 30 percent from last year, industry experts and compensation consultants say. The numbers will be even higher for bond traders and bankers, many of whom will see bumps of 50 to 60 percent, reflecting the fact that they were among the top earners on Wall Street this year.

Alan G. Hevesi, the New York state comptroller, recently said he expects Wall Street to award bonuses totaling about $10.7 billion for 2003, an average of $66,800 per employee, up from $8.6 billion last year. Hevesi said the fatter bonuses will pump $182 million into city coffers, $57 million more than 2002.

Executives at Goldman Sachs Group Inc., Morgan Stanley, Lehman Brothers Inc. and Bear Stearns Cos. have already been told their bonus figures. And for the folks at the top, the news has been stunningly good.

Goldman chief executive Henry M. Paulson Jr. received a restricted stock award worth around $21 million, according to a regulatory filing, up from $2.6 million in 2002. John A. Thain, the Goldman president recently named chief executive of the New York Stock Exchange, received $9.5 million in restricted stock, three times the amount he received in 2002. Lloyd C. Blankfein, head of bond underwriting at Goldman and Thain's successor as president, also received $9.5 million in restricted shares, up from $3.6 million in 2002.

Morgan Stanley chief executive Philip J. Purcell received stock worth around $4 million, compared with $3 million in 2002. Bear Stearns CEO James E. Cayne received $10.4 million in stock, a 30 percent boost over 2002. Figures for these executives -- with the exception of Paulson, who will receive no cash bonus, according to the regulatory filing -- do not include cash bonuses, which will be disclosed in additional filings early next year.

In general, compensation consultants said, Wall Street firms are moving away from big cash bonuses for top executives, awarding more performance-based compensation. Restricted shares generally must be held for an extended time period and can be sold only under certain circumstances.

Other big banks such as J.P. Morgan and Credit Suisse First Boston will give employees their bonus numbers in the next few weeks. Most people expect good news, at least compared with the bonus drought of 2001 and 2002.

"Last year was a joke," said a commodities trader at J.P. Morgan, who expects at least a 30 percent increase. "But the sentiment this year is very bullish."

It is most bullish for bond traders and bankers, who helped generate much of the profit on Wall Street this year. Goldman, for example, recently reported that net income in the fourth quarter nearly doubled to $971 million from $505 million in the same quarter last year, driven mainly by bond, currency and commodity trading. Bear Stearns and Lehman Brothers also reported that fourth-quarter income soared over last year, boosted in large part by bond trading.

Profit from stock underwriting and merger and acquisition advice has started to pick up on Wall Street, executives said, but much of the income from recent deals will not be booked -- or factored into bonuses -- until 2004.

In addition to bond traders, top operations managers are expected to get big bonuses for helping Wall Street make deep cuts to help improve the bottom line, mainly through layoffs.

"The people who are going to get rewarded are the managers who took out the long knives and cut as close to the bone as possible without cutting the bone," said Frank Fernandez, chief economist at the Securities Industry Association.

According to SIA, securities industry employment reached an all-time high of 840,900 in March of 2001 then dropped nearly 6 percent to 793,700 in May of this year. The employment numbers are now creeping up again, reflecting the stock market recovery and a pickup in banking deals.

As a result, several consultants and executives said, Wall Streeters who survived the implosion of the late 1990s market bubble may also benefit from a reduced workload soon. Senior traders, brokers and bankers who had to fire their deputies are now being told they will be able to do targeted hiring in 2004.

"A senior bond trader on the municipal desk who fired his junior trader last year can now make a pretty strong case for money in the budget to get that person back," Fernandez said. "A lot of people on Wall Street have been doing the work of two or three people."

And, unlike in recent years, when firms could give junior employees token bonuses of a few thousand dollars without fear of defections, Wall Street firms are putting up more bonus money this year to make sure they are fully staffed in 2004.

"You really can't afford to lose your talented kids right now," said Jeffrey Bell, an executive search and compensation consultant with the Whitney Group. "You could go and hire a bunch of new MBAs, but they will not be up to speed until the middle of next year at the earliest. So the lower people on the totem pole can expect to do relatively better than the last couple of years."

Not of all of the young rank and file on Wall Street, however, believe they will be able to use this year's bonus for a down payment on a weekend house in the Hamptons or a plush loft in SoHo, common occurrences during the bull market of the late 1990s.

"It will be better, sure. But compared to what?," said a low-level executive at Credit Suisse. "Last year was awful. I'm not that confident. I'll believe it when I see it."

Investment Banking Salaries

’03 Investment Banker Salaries

By ERICA COPULSKY
723 words
9 December 2003
New York Post
35
English
(c) 2003 N.Y.P. Holdings, Inc. All rights reserved.

And with investment banking bonus pools up an average of 10 percent for the first time since the market peak in 2000, there's at least something to cheer about. . . . .

For investment bankers, average bonuses will be anywhere from 10 percent to 20 percent larger than last year's, according to Wall Street executives and recruiters. Professionals in fixed income, which has been one of the biggest securities-industry moneymakers, could see their pay go up 35 percent or more.

Meanwhile, equities pros, whose business hasn't fared as well, could see their bonuses go anywhere from down 15 percent to up 15 percent from last year, depending on their position and level of seniority at their firms.

Some of the Street's rising young banking stars, who have managed to bring in sizable revenues in the challenging environment, could see their pay rise as much as 30 percent. But that may be little consolation for the many bankers who've seen their bonuses on average slashed by 40 percent to 50 percent for the last two years.

"Despite the fact that bonus pools will be higher, many bankers will be disappointed because their expectations are unrealistic based on the incredible paydays in the past," said Regina Glocker, executive recruiter at Westwood Partners.

What's more, the bonus increase will not be enjoyed equally by everyone. "Pay is still very differentiated," explained Jeffrey Bell of the Whitney Group. "Stars will continue to be compensated as stars, despite the averages."

Among managing directors, Wall Street's highest-ranking employees below senior management, those outliers may pull down as much as $2 million to $3 million.

Across the board, underperformers and those working in slumping business lines - including mergers and acquisitions, equities, telecommunications and technology underwriting - may not see their paychecks grow much at all. However, bankers who cater to financial institutions, health care and buyout firms will see a sizable pay boost.

Meanwhile, for the first time in three years, the average Joe Banker will see his paycheck increase proportionally more than those of the superstars, banking executives said.

Despite the market slump, firms have paid their exceptional managing directors exceptionally well to make sure they stay put. Now, firms are shifting their resources to take care of all the other solid bankers they don't want to lose.

"For the first time in a long time, senior management is concerned about losing the middle tier of bankers," said Westwood's Glocker. "With firms running so lean and mean, they recognize that with the market heating up it will be cheaper to hold onto these people than to recruit replacements."

Banking executives are also worried about junior-level employees, especially associates who might quit the Street for jobs that offer better lifestyles. That's why associates will see their pay rise the most in terms of percentages - from 20 percent to 25 percent.

Another piece of good news: The era of full-scale layoffs seems to be over. Wall Street firms are not going to be firing, recruiters said, mainly because it's bad for morale and they don't want to be short-staffed when business comes roaring back.

The average investment banker is seeing plenty of holiday cheer, with a fatter paycheck for 2003 than last year.

’02 Investment Banker Salaries

No Place for Sissies: With comp down 50% - again - bankers settle into a grim, new world

Avital Louria Hahn (avital.hahn@thomsonmedia.com)
3,148 words
17 March 2003
Investment Dealers Digest
English
Copyright (c) 2003 Thomson Financial, Inc. All Rights Reserved.

In early February, the investment banking chief at one bulge-bracket firm steeled himself for a grim managerial task all too common on Wall Street these days: telling his troops that their 2002 bonuses, which account for almost all their pay, would be down 50%. "It was no fun at all," he recalls.

After he delivered the news, his senior bankers-familiar with the yo-yo cycles of investment banking compensation-received it with a degree of sang-froid. Not so the younger ones, some of whom looked stricken. "For young people in particular this is tough," he says. "They never planned on ever not having bigger bonuses."

The new world of Wall Street is no place for sissies, to borrow a phrase from Bette Davis. The salad days of the late 1990s are a tattered memory, and the hard times are beginning to acquire a feel of permanence. Across the board, compensation for 2002 fell about 50%, in many cases for the second consecutive year. A typical managing director who earned $2 million to $3 million in 2000 and half that in 2001, took home only $600,000 to $700,000 in 2002.

"That is still an enormous compensation for 99% of the

U.S.

population," says one Wall Street recruiter. "But for someone accustomed to a lifestyle set upon earnings of $1.5 million, it is a big adjustment."

The upshot: 2002 was one of the worst years in memory for investment banking compensation. Worse, the limping economy leads many to believe that matching 2002's slashed levels may be a struggle in 2003. "There is a growing recognition that the light at the end of the tunnel in investment banking is unlikely to be this year, and one's prior earning power may not return until late in '04 or '05, if then," says Joan Zimmerman, partner at Rhodes Associates.

But beyond the dollars, a fundamental shift in the alignment of Wall Street is taking hold. The role of research analysts is being redefined, long-dominant groups like equities are losing ground as others rise, and bulge-bracket firms continue to be scandalized and demoralized. Meanwhile, lesser entities like boutiques and regional banks-dismissed as almost inconsequential not so long ago-are gaining in stature.

And nothing looms on the horizon that could reverse that shift. "Every time the economy seems to gain some strength, something new pops up and kicks it in the shins," says Andrea de Cholnoky, co-head of global investment banking at executive search firm Spencer Stuart.

Indeed, there is an eerie quiet, almost an acceptance that reality has changed in a profound way that is not just "a brief halt to the party," as one banker puts it.

"There is incredible clarity" about the true state of compensation, adds another recruiter, one of about a dozen interviewed for this story. It used to be, he adds, that bankers would do a little "boofing," or good-natured padding, of what they made. Now, remarks on comp are spot on-"explicit, granular, specific data on how they got screwed," the recruiter says.

Investment banking compensation had its last hurrah in 2000, when it climbed 16% from that of 1999. The latter was one of the boom's biggest years, with pay vaulting 30% higher than that of 1998 (see accompanying historic IDD tables).

Even today, after two years of carnage going on three, optimism isn't completely dead. The Securities Industry Association, for example, predicts a 5% to 7% rise in Wall Street profits and revenues in 2003. But most savants on Wall Street and in its search firms believe that matching 2002 pay levels in 2003 will be a struggle. "Why should it be higher?" says one senior banker. "There are almost no deals."

Write-downs due to settlement charges in the conflict-of-interest scandals whittled the roughly $7 billion in Street profits in 2002 down to $4.8 billion, according to the SIA. That $7 billion figure already represents the worst in eight years-only a third of the $21 billion in 2000. Whatever the profits in 2003, they could be slashed by another $1 billion in settlement "overhang," cautions the SIA.

Overall compensation-Wall Street's largest expense-has fallen in lockstep with profits. Throughout the securities industry, total comp tumbled to $53.3 billion in 2002 from $60.6 billion in 2001, according to the SIA. Even that reduced level was achieved only with the aid of low interest rates, which saved Street firms a bundle, and job cuts so severe that they now total 10% of the 783,000 employed in the industry in the

U.S.

at its peak in 2000. In percentages, the roughly 78,000 jobs lost in the U.S., nearly 10%, slightly exceed the 8.5% job losses of the post-1987 market crash, but are still shy of the 1973-74 crisis when 17% of the industry's jobs were lost, says the SIA.

The sector hit hardest, of course, has been investment banking, and experts estimate that another 5% to 10% in banking cuts are yet to come. "They are waiting for the end of the second quarter, and then they'll see," says one compensation expert.

The 50% tumble in banking comp slammed into the mighty and not-so-mighty alike. At Goldman Sachs, only a handful of non-partner managing directors topped $1 million in 2002, and at Morgan Stanley 27% of all managing directors got no bonus at all for the year.

But the pain was not uniform across all banking sectors. Some department heads took only a 25% hit, while some bankers got no bonus at all. Conversely, bankers in relatively strong sectors like utilities, financial institutions, healthcare and consumer products usually earned more than bankers in groups like telecom or technology.

In the product divisions, cash equities groups lost about 30% to 60% of pay on all levels, with the median cut around 50%, headhunters estimate. On the other hand, fixed-income groups brought in much of the revenues-as they did in 2001-and got compensated better than others, although they were forced to subsidize other departments. Compensation experts say that Goldman Sachs and Citigroup/Salomon Smith Barney had a strong year in fixed income, but that J. P. Morgan Chase's results, and bonuses, left many in fixed income staffers disappointed.

At Credit Suisse First Boston, compensation of high-yield bankers under Bennett Goodman is said to have been slightly down from last year, while the bank's high-grade group was hit harder. Some attribute the difference to Goodman's political clout, as the head of high-yield (one of the few shining legacies of the troubled Donaldson, Lufkin & Jenrette merger) is considered a heavyweight at the bank, sources say. At Deutsche Bank, meanwhile, the high-grade and investment-grade debt groups were hurt less than their investment banking colleagues.

Each bank allocated pain according to its culture. The more team-focused firms, like Goldman and Morgan Stanley, had less dramatic differences among bankers (but were no less democratic when it came to job cuts, say insiders). Others like Salomon, Bear, Stearns & Co. and Lehman Brothers, rewarded their top producers better than they did the "processors and journeymen," as one recruiter puts it. To varying degrees across the street, however, bankers were rewarded more on the merits of their personal and group contribution than according to traditional pay silos.

"Individual performance (i.e., revenue-generated) and compensation have never been as closely aligned as they have become now," says Richard Lipstein, managing director at Gilbert Tweed Associates Inc. "We are no longer in the environment of a rising tide lifts all boats'. Now it is swim or sink.'"

Some banks were (and are) still hiring and signing off on contracts. UBS continuously made use of turmoil at other firms to upgrade its own roster of bankers, as did Banc of America Securities. Another active recruiter, Lazard LLC, had a solid '02, snapping up restructuring business and climbing to seventh place in global announced mergers from eleventh in 2001.

Lazard is said to have inflicted less pain on its bankers than other firms did and to have paid its stars handsomely. Many of its senior new hires still get a contract, and virtually all get an equity stake. Last year, heavyweights like Charles Ward, who had been co-head of investment banking at CSFB and joined Lazard as its president, received a multi-year contract as well as an equity stake.

Even with most of its senior hires already in place, Lazard has seized opportunities in recent weeks to poach front-line bankers disappointed by their firms' bonuses. Such was the case last month, when a group of nine Merrill Lynch & Co. private placement agents, despite a fine earnings year in 2002, were forced to take hits as high as 50% on bonuses to subsidize pay among poorer performing groups. To add salt to the wound, some of that pay was in Merrill stock. Lazard was only too happy to step in and salve those abraded sensibilities with the offer of a new home and an equity stake in one of Wall Street's few remaining private partnerships.

"It was extremely worthwhile for Lazard," notes one source. "The agency business is pure profit." It is not clear whether the bankers, headed by Ben Sullivan and William Riddle, received contracts, but they did receive equity stakes, valuable in light of Lazard's plans to take public at least a portion of its business [still rumored at press time to be asset management].

Lazard's equity offer is one of the few actually being welcomed by bankers. At most other firms, the payment of a huge chunk of company stock instead of cash has been eliciting groans, or worse. Compensation experts say that senior bankers typically receive about 40% of their pay in stock, which can be in the form of stock options or in restricted stock. Often, that stock vests over a period of years, so bankers have been forced to sit and fret while its value has tumbled in the broad market decline.

The whole prospect of owning so much stock in the same firm they work for, while in some ways a logical practice that ties an individual's future to his or her firm's, makes many bankers nervous in such a dismal environment. The practice has a history of kicking into overdrive during hard economic times, says Michael Segal, partner and co-head of the executive compensation and employment benefits practice at Paul Weiss, Rifkind, Wharton & Garrison. "In the early 1990s financial services firms were having difficulties and began to pay bonuses partly in restricted stock to conserve cash," says Segal.

With most banks about to start writing down stock options as an expense in 2003, the use of restricted stock is expected to grow.

Morale is low not only due to lower pay, but also because bankers feel they have so little control over their work and their destiny. "Bankers no longer want to work that hard and still feel insecure, so they leave investment banking," says Maureen Brille, who heads the

U.S.

private equity practice at executive recruiter Egon Zehnder International.

Some have bolted to corporate

America

, where pay is lower than even the reduced levels on Wall Street. There, they are becoming CFOs, or heads of corporate development, or in-house M&A bankers-often for a higher base but lower bonus than they used to get in investment banking. A typical CFO package, for example, consists of a salary of around $300,000 per year plus stock options, according to compensation experts.

Still, at least

U.S.

corporations are expected to increase hiring slightly in accounting and finance, according to a survey conducted by Robert Half International. About 9% of CFOs surveyed expect to expand their finance and accounting departments in the second quarter, 4% expect reductions, and 85% expect no change. Investment banks are expected to shed up to 10% more of their bankers in 2003.

Another traditional haven for bankers, private equity firms, is a whole lot less welcoming these days. Private equity investments have floundered, and quality new investments are still scarce. Despite those woes and a slow hiring environment, the flow of bankers' resumes into the area has increased, sources say.

There is an often unspoken prejudice at work here as well. "There is a bias against bankers in private equity, that bankers are hit-and-run' dealmakers," says one recruiter. "Private equity people have to turn down seven out of 10 deals and their mentality is to hold investments for the long term. That's pretty difficult for bankers."

At the other end of the banking spectrum-entry level-the relationship between Wall Street and business schools has become problematic on both sides.

With all the turmoil on the Street, it is not surprising that banks have done very little recruiting. Many college graduates with a bachelor's degree in business or finance, who in better times would have considered a career in investment banking, no longer view it as an option. One recruiter who recently visited Harvard Business School, says "business school kids dodge investment banking and go directly into M.B.A. programs," adding that Yale has a program designed exactly for that.

But the anxiety even at M.B.A. programs over the job situation facing graduates may be at a record level. It was sufficient to cause the graduate business school at Cornell University to offer to fly recruiters later this month-free of charge-from three big cities in the Northeast to its campus tucked in upstate New York to interview its students, according to wire service reports. The recruiting of M.B.A. students for summer jobs-traditionally a prime proving ground for recruits and firms alike-has also tailed off considerably, with Morgan Stanley and Merrill both reporting class sizes of summer interns down 10% or more.

The traditional structure under which bankers earn a certain salary and bonus for a specific number of years of experience has been blurred due to layoffs and diverging compensation between well-paid producers and the rest of the world. "Given the paucity of deal flow and the thin pipeline in most sectors, as well as continued concern about additional staff cuts, it is natural that the recruitment of entry-level classes has been weak," says Rhodes' Zimmerman. "The compensation ranges that previously applied to specific classes within investment banking have broken down to the point that the variation within classes was enormous."

That may have implications in coming years, says Steve Hall, president of compensation expert Pearl Meyers Associates. "When the economy improves and business picks up again, some classes will have little representation in the work force," says Hall.

Even without banks dropping coverage of hundreds of stocks, the jobs of equity research analysts were already shaken down to their foundations. That turmoil continues, with the future of the research profession shrouded in mystery. Regulators and banks are still jostling over who will pay for this non-revenue-producing activity, and what kind of structure should prevail in research departments.

"There is tremendous uncertainty as to the role of analysts and how they will get paid," says Alan Johnson, president of financial services compensation specialist Johnson Associates. "This is by far the most uncertain period we have ever encountered."

No matter how those debates turn out, one immediate outcome is already a fact of life: Analysts can no longer be as involved in investment banking deals as they used to be. One school of thought has it that even that change has been cosmetic (IDD cover story 3/10/03, p. 24, "Do the New Research Rules Matter?"), but nonetheless, analysts are no longer able to get compensated for bringing in investment banking business as they did during the boom.

Their pay reflects that paradigm shift. A rated senior analyst who two years ago earned $2 million to $3 million now makes $500,000 to $1 million, report Wall Street sources. The Henry Blodgets and Jack Grubmans of the research world, who took in as much as $20 million a year during the height of the frenzy, are now considered the Michael Milkens of the tech era.

A number of analysts have simply packed their bags and left of their own accord, tired of the relentless bad press, regulatory scrutiny and dwindling relevance of their profession in today's equity-lean markets. Senior UBS banking analyst Diane Glossman decided that the time was ripe to ride horses full-time, leaving UBS last month after 25 years at the firm. Others have decamped for hedge funds, the buy side, sector funds that match their expertise or portfolio management.

At the end of the day, however, there are winners in any chaotic situation-as any Street trader could attest. One of the few in the current environment has been boutiques, which were given up for dead in the late '90s, when the Four Horsemen and so many others were swallowed up by bigger banks. These lesser firms, as well as regional banks, have generally avoided the research and Enron-type scandals that have proven so costly and distracting to the giants of the industry.

Boutiques outside New York, especially, are providing a lively alternative these days to bankers who have been jettisoned or who have decided on their own to bolt the grimness in Manhattan. "Boutiques and regional firms have been more active in hiring bankers," says Egon Zehnder's Brille. "Many have been using the availability of talent and drop in bankers' compensation to upgrade and expand their operations."

Firms like Jefferies & Co. on the West Coast or Friedman Billings Ramsey in Arlington, Va., have acquired a sudden cachet. "There is good buzz around Jefferies these days," says one recruiter.

Indeed, Jefferies proved sufficiently attractive in late 2002 to lure notable dealmaker Robert Lessin, the former Salomon Smith Barney merger heavyweight who later joined Wit Capital. Often, bankers get an equity stake in a boutique that could prove valuable should an IPO or buyout occur down the road.

Other winners-not right now but eventually-will be bankers who are simply able to weather the storm. "You may not be making oodles of money right now," says Pearl Meyer's Hall, "but from a career longevity point of view, you'll be in a powerful situation when the market turns around."

’02 Financial chief executive officer Compensation

BY LIZ MOYER
1,404 words
8 May 2003
American Banker
12
Vol. 168, No. 88
English
Copyright (c) 2003 Thomson Media Inc. All Rights Reserved

Compensation for the chief executive officers of financial institutions fell last year, reflecting the dampening effects of the market malaise, but investment bankers still took home more cash than most.

James Cayne, the head of Bear Stearns Cos., came out on top of the Wall Street group and was also the highest-paid financial services CEO in terms of cash, according to an American Banker survey conducted by Executive Compensation Advisory Services, a unit of Towers Perrin. Last year Mr. Cayne, whose firm made it through the market downturn better than its peers largely because of the strength of its fixed-income operation, took home a salary of $200,000 and a bonus of $10 million.

But the chiefs of other Wall Street firms also made out relatively well. Goldman Sachs Group Inc.'s Henry M. Paulson got a salary of $600,000 and a bonus of $6.2 million. Merrill Lynch & Co.'s E. Stanley O'Neal got a $500,000 salary and a $7.1 million bonus. Morgan Stanley's Philip Purcell collected a salary of $775,000 and a $5.6 million bonus.

These four executives made the list of the 10 highest-paid financial services CEOs last year in terms of cash compensation. They were also among the highest-paid in terms of total direct compensation, a broader category that includes options, restricted stock awards, and other payments. Counting these factors, Mr. Cayne received $19.6 million, Mr. Paulson got $13.7 million, Mr. O'Neal $14.9 million, and Mr. Purcell $12.5 million.

The big payouts, though down from the 2001 totals, came despite the bruising Wall Street took last year. These firms, along with Citigroup Inc. and J.P. Morgan Chase & Co., were subject to high-profile regulatory investigations into their research and investment banking practices. Last month they collectively agreed to pay $1.4 billion to settle charges of conflicts of interest.

Executive compensation consultants say that, despite the damaging events, the pay reflects tradition: Wall Street executives have long been at the top of the compensation heap by virtue of their businesses, and boards are reluctant to slash pay, because they want to retain talent.

"There is a retention need," said Jeffrey Kanter, the managing director of the compensation firm Frederic W. Cook & Co. Inc. "Boards know they need to deliver appropriate compensation and compensation correlated to performance."

The average salary for nonbank financial services CEOs rose 3.7% last year, to $867,100, according to Executive Compensation Advisory Services. Average bonuses for this group climbed 52%, to $2.9 million. But the value of options and restricted stock awards declined. The average value of options granted last year fell 30%, to $5.3 million, while the average award of restricted stock dropped by nearly half, to $1.5 million.

And then there were the commercial bankers, those men who presided over the downturn in corporate lending, the dramatic upswing in mortgage banking, and the bread-and-butter business of taking deposits and arranging financing for middle-market companies. Three of them made the top 10 cash compensation list, though the performance of their banks varied widely and reflected for the most part the degree to which the companies rode out the market storm.

In some cases, executives were also rewarded for successful turnaround stories -- or at least survival.

Wells Fargo & Co.'s Richard M. Kovacevich topped the commercial banker group, with a salary of $995,000 and a bonus of $7 million. Not far behind was Bank of America Corp.'s Kenneth D. Lewis, with a salary of $1.5 million and a bonus of $5,375,000. Wachovia Corp.'s G. Kennedy Thompson took home a salary of $1 million and a bonus of $3.7 million.

Including options and other grants, Mr. Kovacevich's total direct compensation last year was $20.4 million, Mr. Lewis' was $20.2 million, and Mr. Thompson's was $13.9 million.

CEOs from three other industry segments rounded out the top 10: Christos M. Costakos of E-Trade Group Inc. took home a salary of $313,000 and a bonus of $6.4 million; Maurice R. "Hank" Greenberg from American International Group Inc. had a salary of $1 million and a bonus of $5 million; Charles M. Cawley from MBNA Corp. collected a salary and a bonus of $3 million each.

The compensation trends for bank, thrift, and monoline CEOs differed somewhat from those for brokers and insurance executives. The average salary for bank, thrift, and monoline CEOs rose 7%, to $1 million, according to Executive Compensation Advisory Services, but the average bonus fell by a third, to $1.8 million.

The value of options granted fell by more than half from a year earlier, to $5.8 million, but the value of restricted shares rose 4.5%, to $2.3 million.

Notable were the CEOs who gave back bonuses, or who did not get any. Citi's Sanford I. Weill collected a $1 million salary but declined a bonus. FleetBoston Financial Corp.'s Charles K. Gifford got a salary of $992,200 but also turned down a bonus. Bank of New York Co.'s Thomas A. Renyi got $1 million salary but no bonus. L. Phillip Humann from SunTrust Banks Inc. got a salary of $950,00, but no bonus.

Janus Capital Group Inc.'s Landon H. Rowland got a salary of $825,000 and no bonus. Charles Schwab Corp.'s namesake got a salary of $883,334 but did not receive a bonus.

And one executive took home nothing: Richard D. Fairbank from Capital One Financial Corp.

Beyond the top 10, most CEO pay packages settled into a range of $3.8 million to $4.8 million for the next seven and then $1 million to $2.8 million for everyone else.

The list includes the chief executives of several insurance firms. MetLife Inc.'s Robert Benmosche got a salary of $1.08 million and a bonus of $3.5 million. Allstate Corp.'s Edward M. Liddy took home $1 million of salary and a $3.1 million bonus. Daniel P. Amos of American Family Life Assurance Corp. (Aflac) got a salary of $995,000 and a bonus of $2.8 million. Jay Fishman, the former Citi executive now at the helm of St. Paul Cos., took home $1 million of salary and a $1.1 million bonus.

In credit cards, American Express Co.'s Kenneth Chenault got a salary of $950,000 and a $2.8 million bonus. Providian Financial Corp.'s Joseph Saunders got a salary of $600,000 and a bonus of $1.2 million.

Many other CEOs on the list run commercial banking companies. JPM Chase's William B. Harrison Jr. got a salary of $1 million and a bonus of $3 million last year. He also got the second half of a $10 million merger-related bonus promised to him two years ago, when his firm, Chase Manhattan Corp., bought the legendary Wall Street investment house. This extra bonus was not reflected in the annual survey.

PNC Financial Services Group Inc.'s James E. Rohr, who steered his company through a period of regulatory supervision, made several top management changes, and altered its corporate governance, got a salary of $850,000 and a bonus of $900,000.

James Dimon from Bank One Corp. took home $1 million of salary and a $3 million bonus. George A. Schaefer from Fifth Third Bancorp received a salary of $1 million and a bonus of $1.6 million. Kerry Killinger of Washington Mutual Inc. collected a salary of $1 million and a bonus of just over $3 million.

As has been the case in recent years, however, stock grants helped fill the void. In many cases, chief executives doubled or even tripled their take-home cash pay with stock options, and those options are valued at currently depressed levels, meaning they could eventually make out even better.

MBNA's Mr. Cawley took home a stunning $54 million, counting the value of his 3 million options, which, according to the Executive Compensation Advisory Services the survey, was more than $29 million. Those options made him the highest-paid financial services CEO last year.

In Brief: Morgan Chase Cut '02 Bonuses at the Top

BY Liz Moyer
194 words
31 March 2003
American Banker
19
Vol. 168, No. 61
English
Copyright (c) 2003 Thomson Financial, Inc. All Rights Reserved.

NEW YORK -- J.P. Morgan Chase & Co. cut its chairman and chief executive's cash pay 17% from 2001 as the company struggled with a lackluster investment banking environment, regulatory inquiries into its role as a financier to Enron Corp., and a 34% drop in its share price.

William B. Harrison Jr. got the same salary as in 2001, $1 million, the company said in a proxy filed Friday with the Securities and Exchange Commission. His cash bonus was cut to $3.08 million from $5 million. He did receive the second half of a total $10 million merger-related bonus promised him two years ago when J.P. Morgan and Chase Manhattan Corp. combined. Without the merger bonus, Mr. Harrison's cash pay declined 32%.

Other senior executives' cash bonuses were cut, including investment banking chief David A. Coulter, (down 33%), retail banking chief Donald H. Layton (62%), finance and risk chief Marc J. Shapiro (49%), and chief financial officer Dina Dublon (16%).

Sell-Side Equity Research Analysts

(2002) Sell-Side Analysts on All-American Teams Can Earn $1 mln.

The Journal of Psychology and Financial Markets, Vol. 3: No. 4, 198-201 (2002).

Becoming an analyst for a large Wall Street firm is very difficult and prestigious. It is also very lucrative.

Institutional Investor All-American analysts routinely take home $1 million per year in compensation. Super-

star analysts like Morgan Stanley internet guru Mary Meeker and Salomon telecom analyst Jack Grubman

earned an estimated $15 million per year. For anyone compensated so handsomely, a major motivating factor

in his work must be the maintenance of this wonderful, high paying job. This factor alone can clearly explain

Hedge Fund Managers

Private Equity Managers

Salary survey: Private equity base pay tops bankers'

433 words
9 October 2003
eFinancialNews
English
(c) 2003 eFinancialNews Ltd. Data not available for redissemination.

Private equity specialists are paid higher basic salaries than other financiers as well as receiving additional payments from shares of their funds' profits, according to a compensation study.The lowest level of partner at the average US buy-out firm receives a basic salary of $200,000 (€176,000) this year, while average salaries for senior partners are more than $450,000, according to a report by research firms Private Equity Analyst and Holt.

The most senior partners award themselves basic pay of almost $600,000. US venture capitalists receive almost identical amounts and the picture is much the same in Europe, say institutional investors.

The study shows the average level of basic salary has risen by 14% for top buy-out partners and between 3% and 7% for other buy-out partners since last year. Junior partners at venture capital firms have seen basic pay go up by 10%.

According to one headhunter, a senior fund manager could expect a basic salary of around $175,000, while a chief investment officer might hope for $300,000. Another said a managing director at a bulge-bracket investment bank could earn base pay of $200,000 to $250,000.

Fund managers and bankers expect bonuses but these are unlikely to be as high as the share of profits, or 'carry', that can go to partners of private equity firms. Carry is usually 20% of any capital gains made by the funds that private equity firms manage, once they have achieved a hurdle rate of return for their investors.

A few private equity firms, including venture capitalists Sequoia, Benchmark, Redpoint and Charles River and buy-out firm Bain Capital, take 30% of any capital gains, according to investors.

Private equity firms can afford to pay their staff basic salaries because they have increased fund sizes without making comparable reductions to their annual management fees. These were originally set at 2%, to cover day-to-day running costs.

Apart from a handful of exceptions, including

venture capitalist New Enterprise Associates and

buy-out firm Alchemy Partners, the management fee rate has not fallen below 1.5%. Investors say Charterhouse Development Capital, the

buy-out firm, is charging 1.5% on the €2.7bn fund it raised two months ago.

The firm has 19 investment staff, which works out at fees of €2.1m each a year on this fund alone. Cinven, Candover, BC Partners and Doughty Hanson receive similar amounts, while Permira, CVC and Industri Kapital, with larger staff, are receiving around half as much.

Equity & Bond Fund Managers

Bond Managers

Financial Times, "Avenue of the Americas," September 2, 2002, p. 11

Rich reward

Unwelcome news for investors reeling from losses on Enron, WorldCom or any number of other troubled companies: some in the financial world are benefiting from your bad fortune.

US portfolio managers specialising in distressed debt earned on average a whopping $823,000 last year - more than double the average bond fund manager's income of $333,000, according to Greenwich Associates, a consulting and research firm.

With record amounts of debt now trading in the "distressed" category, it is a safe bet that this is one job to which newly unemployed Wall Street mavens are flocking like vultures.

’03 Univ of Texas Investment Managers (UTIMCO)

Robert Elder Jr., AMERICAN-STATESMAN STAFF
1,016 words
14 January 2004
Austin American-Statesman
A1
English
Copyright (c) 2004 Bell & Howell Information and Learning Company. All rights reserved.

The issue of pay for the University of Texas System's outside investment company has emerged as a potentially deep rift between the UT regents and the managers of the system's $14.8 billion endowment. The board of directors for the University of Texas Investment Management Co. voted 6-2 Tuesday to approve a new compensation plan for its managers, despite a warning to hold off until UT regents finish reviewing the operations of the company, known as UTIMCO.

Stock Brokers

’01 Brokers Salary as a % of Gross Production

In a world of converging financial services, it is almost inevitable that salespeople from different industries — insurance and securities, for instance — will compete head-to-head for clients. Who will win, stockbrokers or insurance agents? Bet on the stockbroker.

As principals of the CBM Group, a New York-based consulting firm, we have analyzed both insurance agents and registered reps. What we have found over the years is that brokers, on average, tend to be much more productive salespeople than those hawking insurance.

Indeed, an insurance producer would have to be in the top 10 percent of the profession to make what the average stockbroker earns. In 2001, average broker compensation was around $182,000 on gross production of $400,000. This number implies a payout rate of about 46 percent. Since gross production tends to be around 1 percent of assets under management (AUM), the average broker had $40 million in AUM. Assuming asset turnover of between 20 percent and 25 percent per year, one can deduce that the average broker sells between $8 million and $10 million worth of “new” product each year. (Clearly there is a wide dispersion of performance behind the averages, but the mean numbers do offer insights, nonetheless.)

For life insurance, CBM estimates suggest an average salesperson compensation of $60,000, two-thirds of which correspond to new product sales and one-third to renewals or trailers. CBM's proprietary methodology for calculating “equivalent gross” production for insurance producers suggests an average of around $100,000 per year, or about one-quarter that of an average broker. The average life insurance agent brings in about $1 million worth of premiums and/or assets a year. (As in the brokerage industry, there is a wide range of performance in life insurance sales: the top 10 percent of insurance agents generate about 25 times the production of the bottom 10 percent.)

One obvious factor in the production disparity between brokers and insurance salespeople is that securities firms serve a wealthier customer base. A typical wirehouse brokerage client will have investible assets in the mid-six figures, whereas life insurance clients have, on average, around $100,000.

However, the securities industry has to work harder for the money, too. Its relatively wealthy clients tend to be more demanding than the average insurance client. As a result, securities firms need more sophisticated salespeople to serve such clients. In addition, brokerage firms also have a more expensive business model than life insurers. A brokerage firm offers considerable support to its producers: a desk or office, technology, sales assistants, research, compliance, complex back office operations, etc. This kind of support is costly: up to $150,000 of fixed and semi-fixed cost for an average producer. By contrast, life insurance companies offer minimal support to their producers, who are typically “attached” to an agency office but most of the time, they go to the client or prospect's location.

Brokerage firms need more productive salespeople to offset the higher cost structure, and, as a result, they tend to put much more pressure producers to, well, produce.

All brokerage firms have strict “up or out” policies for trainees and experienced producers. The average production of brokers almost always increases with years of service. In life insurance, however, it is quite common to see producers who have been in the business for many years stagnate or even decline in terms of production. Since their cost structure is almost fully variable as a function of production, life insurance companies tolerate part-time and semi-retired producers and offer them the option of working out of their homes.

Producer compensation is another major difference between the two industries. Brokers “eat what they hunt.” Most of their compensation is directly tied to fees and transactions — commissions and sales loads. In life insurance, trailers and renewal commissions are substantial, and it is quite possible for an experienced life insurance producer to “slow down” but still make a comfortable living from renewals.

That said, when taking stock of the competition from the insurance industry, it would be a mistake for brokers to be dismissive. (If for no other reason than because they are vastly outnumbered, 400,000 to 100,000.) But the fact remains that in a head-to-head competition for a client, a broker is likely to be the fitter foe.

Andre Cappon is president and Guy Manuel managing director with The CBM Group, a New York-based consulting firm specialized in the securities industry.

2004 Stock Broker Commissions & Compensation

Tony Chapelle
3,128 words
1 March 2004
On Wall Street
English
Copyright (c) 2004 Thomson Media Inc. All Rights Reserved

In contrast to the turmoil affecting the mutual fund business, one important part of life as a broker remains relatively unchanged for 2004: compensation. Firms may have tweaked their plans here and there, but most adjustments follow the pattern of recent years in which firms continue to encourage larger production and penalize the low end.

One major compensation change that may be coming, however, is complete product and service neutrality. Smith Barney's new grid may presage such a shift. The firm eliminated a payout program that featured three product categories, replacing it with one based on production and longevity. Even incentives to move clients to fee-based accounts were eliminated.

With regulators and legislators keen on removing hidden biases in the way mutual funds are traded and sold, one can assume that the broker-fund relationship - including compensation - may change. If funds are barred or discouraged from paying for shelf space, if more disclosure sheds embarrassing light on how fund assets pay for marketing, and if the conflicts in the management and distribution of in-house funds incur the wrath of regulators, watch out. Not only will payout on funds be affected, but the economics of retail brokerage, which depends on infusions from product companies for conferences, education, product support and broker incentives, will change dramatically.

For 2004, Advest has changed its grid for the second time in as many years, largely to discourage lower-end producers. As opposed to a year ago, when cuts were made across the board, the most recent changes affect only reps generating less than $150,000 in commissions who have been in the business for eight years or more. Those producers will have their compensation reduced by three percentage points on commodities business, five points on transactional trades, nine percentage points on fee-based business and 25 points for insurance and financial planning.

A year ago, Advest rolled out a new comp plan that trimmed commissions for all reps but permitted reps producing above $300,000 to recoup the reductions through a company-paid bonus in the Wealthbuilder plan. The plan is a five-year, deferred comp program to which Advest annually contributes from 1.5 to 3 percent of a rep's gross.

The long static grid at A.G. Edwards held steady once again. A company spokesperson said that just one change was made to brokers' compensation in the past year, making it easier for brokers to qualify for higher compensation.

Instead of an annual review, Edwards' managers now conduct monthly reviews of any brokers who have fallen into a penalty box the company instituted in 2002. The penalty box was created to reduce payouts by five percentage points for those reps with more than five years of experience who generate less than $162,500 over a 12-month period.

Under the revised formula, management now reviews reps' production figures each month to allow financial consultants who boost their production back above the $162,500 threshold to qualify for standard payouts.

Edward Jones, which has more branch offices than any other firm and is Wall Street's largest remaining partnership, did not change broker payouts for 2004, according to a spokeswoman.

The firm did increase the amount that partners and brokers receive as a result of their branches' profitability. In 2003, the company contributed 3.58 percent of a broker's eligible earnings up to a maximum of $7,160 to the three-times-a-year profit-sharing bonus. In 2002, that had been 2.81 percent with a cap at $5,620.

Edward Jones could face changes as the result of a likely regulatory investigation into the firm's "revenue sharing" agreements with mutual fund complexes. "Various regulatory bodies and Congress are looking at the issue with a number of companies. I assume reform measures might include all aspects of the way mutual funds are sold," said spokesman John Boul.

Last November, the company said it had postponed a $150-million limited partnership offering due to impending changes the SEC and other regulators may require.

Average production for Edward Jones brokers with at least 10 years of experience was $481,591 in 2003.

For the second consecutive year, Janney Montgomery Scott revised its comp plan. This year, the firm lowered payouts to reps who produce less than $150,000 a year.

The new plan compresses two payout levels' breakpoints - for those producing $125,000 to $132,000 a year in gross commissions and those between $132,000 and $156,000 - and combines them into one category for those producing between $125,000 and $150,000.

Reps producing less than $125,000 now will receive 20 percent per trade, instead of the previous 25 percent. Payout on the new grid for brokers producing between $125,000 and $150,000 is 25 percent. Under the old grid, reps producing between $132,000 and $156,000 received 37 percent for listed options and over-the-counter equities and 44 percent for all other products.

As of February, Legg Mason was planning no changes to its grid for a new fiscal year beginning in March. In fact, according to Robert Sabelhaus, executive vice president and director of the firm's private client group, Legg Mason made only one change to its broker compensation plan in the past 12 months: eliminating an annual bonus paid to reps for selling annuities.

Meanwhile, broker production at the Baltimore-based firm is climbing. According to industry analysts, the average Legg rep generates $458,000 in annualized gross commissions. That figure beats a $450,000 forecast by analyst Guy Moszkowski at Merrill Lynch. Last spring, average production was under $400,000. One reason for the production jump was a 43 percent increase in inflows to Legg's in-house mutual funds, which account for 25 percent of total holdings of the typical Legg Mason client. The industry average for proprietary funds as a percentage of total assets is about 20 percent.

Legg Mason funds had the highest performance over the past three and five years of any equity funds - 8.6 percent and 8.4 percent, respectively - from a publicly-traded asset management firm.

Over the next several years, the firm says it plans to hire or train 70 reps per year producing an average of $600,000.

Over the past year, Merrill did not change its compensation plan for the vast majority of its brokers.

The company did, however, tweak the rules for Private Wealth Advisors, those reps in the firm's private banking and investment group (formerly known as private wealth advisory) who work with ultra-high-net worth clients. PWA brokers who perform transactions for clients with less than the required assets - $10 million - will not be compensated if the rep has more than the 100 client-household maximum.

Merrill's current comp scheme was rolled out in 2002. It includes higher payouts for "level load" business (asset-based fees, C-share mutual funds, the unlimited trading account, insurance, trails and lending) than for transactions. It also penalizes brokers for handling accounts with under $100,000 in assets and liabilities. Analyst Ruchi Madan of Smith Barney credited the plan with helping Merrill hold on to the top 40 percent of its producers while reducing headcount by 6,000 since 2000. Last fall, James Gorman, president of the firm's private client group, said Merrill would make a net addition of about 650 reps to its brokerage force this year.

No changes were made to Morgan Keegan's compensation plan this year, save for a production increase to $500,000 from $450,000 in the eligibility requirement for the firm's President's Club.

Overall, Keegan hasn't changed its compensation plan since 2002, when it lowered payouts to lower-producing brokers (those under $150,000) and gave more to higher-end producers (those over $500,000).

The firm pays a three-percentage-point premium on "financial services products" (mutual funds, insurance and managed accounts). And it pays a restricted cash award that vests in five years. That cash - which ranges from an additional two to six points of commissions for producers above $300,000 - can be directed into a group of Morgan Keegan funds, stock in the parent Regions Financial Corp., or an S&P 500 Index fund.

In 2003, the number of reps at Morgan Keegan declined but their production was up, according to John Moss, director of special projects. He credits part of the increased revenues to the marketing and asset management training the reps received from outside experts.

At Morgan Keegan, the average production of reps with more than 10 years of experience was $384,722.

Aside from a change to one penalty box, Morgan Stanley has not changed the two-part grid it introduced a year ago.

Now, clients must have at least $50,000 in household assets at the firm or brokers are penalized with a reduced payout of 30 percent on asset-based revenues, 20 percent on transaction-based business and 50 percent of residual fees. Last year, the minimum was $25,000, according to spokesperson Andrea Slattery.

At the high end of the customer spectrum, brokers in the firm's Private Wealth Management division no longer are compensated for transactions or fee-based advice given to clients with under $1 million in their private wealth accounts.

This year, Morgan Stanley cut certain customer fees, dropping charges for returned checks and stopped checks for Platinum (million-dollar) households, for instance.

Finally, sources say that Morgan Stanley no longer pays branch managers bonuses based on sales of proprietary funds at their branch. Instead, managers are paid bonuses on their branches' net new assets, how well the branches retain assets, how well the mangers recruit brokers and regulatory compliance.

This year, the firm is planning to train 1,800 rookie brokers, nearly double the size of last year's class.

Last year, Fahnestock & Co. acquired the retail business of CIBC Oppenheimer, adding 600 brokers to its own 1,100. Soon after, the firm renamed itself Oppenheimer & Co. For 2004, Oppenheimer decided to keep the two separate grids and update them.

"When we combined the two firms, we had an extremely varied level of brokers," said Tom Cassidy, national sales director, who created the new commission structure. "To pay people appropriately, we added more levels of payout."

Meanwhile, Cassidy said there is a big difference between what the firm's brokers were paid last year and what they'll receive in 2004. The top payout for legacy CIBC reps is now 48 percent for producers at or above $850,000, versus 45 percent. For legacy Fahnestock reps, top rate moves to 50 percent, from 45 percent. When the grids become one next year, the top payout for ex-CIBC reps will move up to 50 percent. At the lower levels, legacy Fahnestock reps with under $350,000 in production will see their payouts reduced by one to four percentage points.

The company retained Fahnestock's asset bonus and length of service bonus, which CIBC didn't have. There's also a stock appreciation rights program that gives reps the ability to buy 100 options for every $50,000 in gross that they generate over $250,000.

For the fifth consecutive year, Raymond James & Associates made no changes to its grid.

The company did, however, make one change to its deferred compensation program, increasing the production level needed to qualify for deferred comp to $300,000 from $225,000.

According to a rep at RBC Dain Rauscher, the firm hasn't altered its grid since January 2003, when it made its third consecutive annual change to broker comp. Over that period, Dain Rauscher was acquired by Royal Bank of

Canada

. It also acquired Tucker Anthony Sutro.

Ryan Beck kept its grid intact in 2003, a year after acquiring the private client group and other parts of the former Gruntal Financial. The acquisition increased Ryan Beck's 80-person salesforce by more than 500 reps.

Payouts at Ryan range from 20 percent for low-producing brokers with more than 10 years of experience to 50 percent in certain product areas. In addition, the company adds a deferred comp bonus of between one and three points for producers doing better than $250,000. There also are incentives to gather fee-based assets: Brokers with more than $10 million under management receive higher payouts on the assets, a cash bonus, and a deferred bonus, totaling 52 to 60 percent.

This year, Smith Barney made the biggest change to broker compensation of any major firm. In essence, it folded its three-product category scheme into one product-neutral grid. Kevin McManus, managing director and chief administrative officer of the branch system, said the plan is not only simpler, but helps eliminate the perception of compensation-driven product biases.

In addition, he said management set up the new plan to reward Smith Barney brokers for greater productivity, particularly at the higher ranges. The biggest jump is for million-dollar producers. The new grid has five additional breakpoints after $1 million. Reps at $1 million and better now receive an added half-point payout. They could move up by as much as three percentage points to 48.5 percent when factoring in the deferred bonuses payable in Citigroup stock for production and years of service. The highest payout possible is 50.25 percent for reps who generate $5 million in gross.

Under the new plan, reps who had large annuity or insurance businesses may make less money. Payouts on insurance sales have been lowered to 41 percent from 50 percent, and the five- to 20-point bonuses on sales of annuities have been dropped.

To soften the impact of the grid change for brokers who produce $300,000 or less and who would lose $5,000 or more, Smith Barney will make quarterly payments equal to two-thirds of the revenue the brokers would have made on the 2003 grid. In 2005, the firm will pay them one-third of the lost revenue. Brokers who lose less than $5,000 are not covered.

The company also eliminated cash or stock bonuses worth two to eight additional points based on assets under management. McManus said the company decided it didn't want to incent brokers on idle assets; again, the emphasis has shifted to rewarding more production. But reps can still earn annual cash bonuses of up to 3.5 percent of their production and up to 2.75 percent based on length of service, as well as a deferred stock bonus of up to 1 percent based on length of service.

In fact, the company introduced two new deferred comp plans that are based on overall production, not individual product sales. The plans invest in Citigroup stock; the old stock option award has been changed to a deferred restricted stock award based on 50 to 100 basis points of production.

Smith Barney also continues its voluntary Capital Accumulation Plan (CAP), a deferred comp account that permits reps to buy Citigroup stock at a 25 percent discount by using up to 25 percent of their pre-tax income.

McManus says his firm pays more in cash than in stock, which other firms favor. While some firms are trying to retain brokers by requiring them to receive as much as seven points of their annual production in deferred stock-based bonuses, McManus said Smith Barney has kept the deferred portion of its compensation "below four points. This is a level our FCs are very comfortable with."

Stifel, Nicolaus & Co., a St. Louis-based regional, has a unique pay structure. It has only two breakpoints: 25 percent and 50 percent. Last year, the firm made just one change, raising to $8,000 from $7,000 of gross the point at which the 50 percent payout begins.

At the high end, the firm pays a bonus equivalent to a point-and-a-half in additional production to reps who gross more than $250,000 a year. The bonus is capped at $7,500 a year.

Stifel also pays three types of deferred compensation: a stock bonus based on production, a restricted stock bonus based on production, and a grant of stock options. Reps also can receive so-called non-elective deferrals. The awards all kick in when reps gross more than $250,000.

The UBS grid remains unchanged since 2001. The firm continues to encourage fee-based asset gathering and lending through three bonus plans.

The first award is for productivity and length of service, and pays up to 4 percent of production. It takes 10 years to fully vest, although vesting starts in six years.

The second is for gathering net new assets and non-purpose loans. It maxes out at 4 percent of production and is paid in cash once a year.

The third is for the size of a rep's assets and non-purpose loans. It pays a maximum of a half-basis point through a half-cash, half-deferred cash plan. Deferred awards may be contributed to the Partners Plus program, to which reps also can make voluntary contributions.

Average production for UBS reps with at least ten years' of experience is $511,242.

Since Prudential Securities was absorbed into Wachovia Securities eight months ago, brokers continue to work under their existing grids - even in cases where former Pru brokers work with Wachovia brokers in combined offices. Spokesman Tony Mattera said the comp plans would be unified by 2005.

Until the grids are combined, brokers with the same production can receive different paychecks. Low-end Wachovia reps, for instance, earn less than their legacy Pru peers, while legacy Pru brokers generating more than $300,000 earn less than legacy Wachovia reps.

In another difference, transaction-oriented reps under the Wachovia schedule receive more than Pru reps. A $1 million transactional producer at Pru maxes out at 42 percent, for example, while a Wachovia broker maxes out at 52 percent.

For both sets of brokers, the firm has instituted several new fees, including a $50 annual fee for accounts with under $250,000 in assets and an increase to $40 from $35 for qualified plan accounts such as IRAs and Simplified Employee Pension (SEP) plans.

Derivative [futures & options] Professionals

General Finance Professional Salaries

Exclusive IOMA Survey Finds Finance Pros Earn Average $ 82,311 Salary Survey Overview

Copyright 2003 IOMA Report on Salary Surveys August 2003 SECTION: Pg. 2

HEADLINE: Exclusive IOMA Survey Finds Finance Pros Earn Average $ 82,311 Salary
Survey Overview

Finance professionals earn an overall average of $ 82,311 and have 17.3 years
of experience, according to an exclusive IOMA survey found in the Accounting
Department Management & Cost Control Reference Guide 2003. Inevitably, this
average salary changes along with the job titles.
Selected Data
The highest paid title in this survey is the CFO, who, with nearly 21 years of
experience, 12 of those in accounting management, earns an average $ 98,529 (see
Table 1). The vice president of finance has almost as much experience, at 19.8
years, and earns just slightly less, at $ 95,345. The VP has 10.4 years in
accounting management.
The accounting/financial manager earns $ 70,349, and has 14.8 years of
experience overall, with 5.9 years in accounting management alone.
The company's size does make a difference for finance professionals. Companies
with less than 250 employees pay much less in most cases than organizations with
more than 250 people.
A controller earns $ 82,931 overall, but at a firm with 250 people or fewer, the
average salary is $ 74,211 (see Table 2). At a company with over 250 employees,
the average salary is $ 90,745. Controllers in both size groupings have nearly
the same amount of experience-around 16 years, but the controllers at larger
firms have slightly more time spent in accounting, at 8.4 versus 7.2.
There is also a substantial pay difference between vice presidents of finance at
small and large firms. At companies with less than 250 employees, the VP of
finance earns an average of $ 87,857. At organizations with 250 and over, the
average salary is $ 102,333. Each has roughly the same amount of experience.
Accounting managers at smaller firms have more experience but earn less pay, at
an average $ 63,824 and 7.4 years in accounting. Managers at larger companies
have 4.9 years in accounting and earn $ 74,615.
For CFOs, however, the company size makes only a small difference. Those at
firms with up to 250 people earn an average $ 97,500, while those at
organizations with over 250 employees earn $ 99,444. At the same time, CFOs at
small companies have 13.5 years of overall experience and 7.0 in accounting,
while those at large firms have 25.8 years overall and 15 in accounting.
Purchase Information
Accounting Department Management & Cost Control Reference Guide 2003 is
available from IOMA; contact customer service, IOMA, 29 West 35th Street, 6th
Floor, New York, NY 10001; 212-244-0360. E-mail subserve@ioma.com, or visit
www.ioma.com. Cost: $ 119.

Table 1. Annual Financial Salaries, by Position and Experience

Years Experience Managing Salary Overall Acctg.
CFO $ 98,529
20.9 11.8
VP finance 95,345
19.8 10.4
Director of finance 86,935
18.5 8.8
Controller 82,931
16.6 7.8
Acctg./financial mgr. 70,349
14.8 5.9
Other 66,500
15.1 9.1
Overall 82,311
17.3 8.6

Table 2. Annual Financial Salaries, by Position, Company Size, and Experience
Years Experience
Managing
Salary
Overall Acctg.
Up to 250 employees
CFO $ 97,500
13.5 7.0
VP finance 87,857
19.8 10.8
Director of finance 77,500
16.9 8.1
Controller 74,211
16.3 7.2
Acctg./financial mgr. 63,824
15.3 7.4
Other 47,500
13.6 10.2
Overall 74,406
16.5 8.3
Over 250 employees
CFO $ 99,444
25.8 15.0
VP finance 102,333
19.7 10.0
Director of finance 92,222
18.5 8.2
Controller 90,745
16.9 8.4
Acctg./financial mgr. 74,615
14.6 4.9
Other 79,167
15.9 8.6
Overall 88,231
17.8 8.7

Credit Unions

Presence Of A CUSO Plays Big Role In Credit Union CEO Compensation

Copyright 2003 American Banker-Bond Buyer a division of Thomson Publishing Corporation
Credit Union Journal Vol. 7; No. 29; Pg. 40   July 21, 2003
Presence Of A CUSO Plays Big Role In Credit Union CEO Compensation

BYLINE: By Lisa Freeman, Associate Editor
DATELINE: MADISON, Wis.

   As credit unions increasingly expect more from their executives, in the form
of higher levels of education and the ability to manage much more complex
institutions, those executives are also coming to expect more from their credit
unions, as evidenced by CUES 2003 Executive Salary Survey.

   "In 1991, 40% of credit union executives had a college degree. Today, nearly
80% have a four-year college degree or higher," said CUES VP-Professional
Development George Hofheimer. "Credit unions are requiring more formalized
education than in the past. This is not surprising, because the complexity of
these institutions has increased."

   Level of education typically does come into play when compensation levels are
set, and one reason more CUs are putting a premium on executives with higher
education backing them up may be that the job of running a credit union has
become more complex. In addition to credit unions growing in terms of sheer
size, they are also getting into more diversified areas of business member
business services, indirect lending, real estate lending and other more
sophisticated offerings.

   Correlation Seen

   Also adding to the potential complexity of running a credit union is whether
or not a CUSO is involved. Hofheimer said CUES has found a correlation between
having the presence of a CUSO and a higher salary.

   "One of the things we've been trying to track is how CUSO ownership affects
compensation," he related. "It's difficult because there's no one definition of
what a CUSO is. They can serve a lot of different purposes, and they can be
owned by one credit union or many credit unions. But CUSO ownership is one area
that has the opportunity to break all the rules of compensation in the credit
union world."

   In credit unions with assets greater than $400 million, the average base pay
for the CEO was $230,842, with a total compensation package coming in at
$276,844.

   Of those 138 CUs in that asset size that participated in the survey, 95 had a
CEO with a CUSO executive, and 43 without a CUSO executive. Those CEOs with a
CUSO outearned their non-CUSO counterparts. Those without a CUSO earned an
average base of $215,589 compared to $237,746 for those with a CUSO.

   But the more dramatic disparity shows up in total compensation, when bonuses
and incentives are figured into the equation. The CEO without a CUSO earns an
average $218,965 in total compensation, compared to $289,417 for average total
compensation earned by CEOs with a CUSO.

   These figures point out the increasing importance of "at-risk" pay in the
credit union compensation world. "The number of credit unions using bonuses and
incentives tends to increase every year, as it has for several years," Hofheimer
noted. "As credit unions focus on the financial performance and growth of the
credit union, they are using at-risk pay to incent for those results. Fifty-five
percent (of survey respondents who said they receive at-risk pay as part of
their annual compensation) said the primary factor (driving the amount of the
bonus) was earnings. Let's face it, credit unions have no other means of raising
capital, so they live or die by earnings growth."

   The trend toward greater levels of education, higher salaries and use of
at-risk pay may be among the few areas where emulating banks isn't such a bad
idea. And as credit unions tap former bank personnel for executive positions,
credit union land may seem more of the same in the years to come.

   The Role of Ex-Bankers

   "We don't survey for this, so this is just my personal opinion based on
anecdotal evidence," Hofheimer observed, "but one reason that banks have been
using at-risk pay longer than credit unions is that it is a natural part of the
banking perspective. Incentives like stock ownership are naturally built in,
particularly at community banks, where it's not uncommon that the CEO and the
board are the major stockholders. I think the shift in credit unions is largely
the result of external environment. Before, credit unions operated in a much
more insulated environment, especially single-sponsor credit unions, for
example."

   And it's not just former bank executives entering the credit union community.
"Anecdotally, we see that we have CEOs coming from the banking industry, but it
's also people coming from the corporate world to the credit union world,"
Hofheimer commented. "For example, you've got credit unions that serve a
company, and then you see executives from that company making the leap over to
the credit union."

   In other findings coming out of the survey, executives in charge of
e-commerce continue to see an increase in their compensation levels, despite the
"dot.bomb."

   "It's not at the same level as during the dot.com boom, but we're still
seeing higher compensation levels for the executives in charge of e-commerce
initiatives," Hofheimer offered.

Accounting

Personality preferences of accounting students: a longitudinal case study

Journal of Accounting Education Volume 21, Issue 2 , 2nd Quarter 2003, Pages 75-94

As the skills needed to succeed in accounting broaden, accounting programs must develop recruiting strategies to attract and retain individuals with a broader range of personality characteristics. As a form of recruitment evaluation, this study uses the Myers–Briggs Type Indicator (MBTI) to examine the characteristics of accounting students recruited into and retained by one of the original Accounting Education Change Commission (AECC) grant programs. Results indicate that, contrary to expectations, the personality types attracted to and retained in the program have not become more diverse over the course of 8 years. These results may imply that certain requisite preferences are needed to succeed in accounting or that homogeneity has benefits not previously considered. They certainly suggest a need to further refine recruiting processes, to focus on broader perceptions of the profession, to evaluate faculty's own preferences and biases and/or to develop curriculum to help students learn to utilize their less preferred personality traits.

Website for Current Accounting Salary Surveys

Copyright 2003 Gale Group, Inc.
Business and Management Practices
Copyright 2003 The New York State Society of Certified Public Accountants
CPA Journal (The) May 2003 SECTION: Vol. 73, No. 5; Pg. 15; ISSN: 0732-8435

RDS-ACC-NO: 3861164

HEADLINE: Website of the month: LocalAccountingJobs.com. (What to Bookmark).
LocalAccountingJobs.com was created by Cleveland-based Local Jobs, Inc., as part of its expansion to major metropolitan areas around the United States. The website is organized in a discipline- and geographic-specific format with a goal of streamlining and targeting the potential opportunities for job seekers and employers. The website currently includes positions in 11 major metropolitan areas, with more planned. An excellent, but hidden, feature of the website is a
very detailed finance and accounting salary survey, which can be accessed via "press releases."

’02 Accounting and Finance Starting Salaries

MENLO PARK, Calif., Dec. 10, 2001 (Accountemps) — Recent results of the Robert Half and Accountemps 2002 Salary Guide reveal that starting salaries are expected to increase by an average of just 1.5 percent in 2002.

"The conservative compensation outlook is a reflection of today's business environment," said Max Messmer, chairman and CEO of Robert Half International. "While for the most part starting salaries should remain stable, declines are anticipated in some specialties as companies reassess their pay structures. Many employers have less flexibility with compensation plans due to cost-controlling measures."

With a growing pool of qualified candidates, organizations are more selective when making hiring decisions. "Firms are seeking accountants who not only meet the basic job requirements, but also can contribute to the company's strategic business goals," Messmer said.

The survey found that public accounting firms continue to increase salaries. Starting salaries will remain strong at public accounting firms as they continue to compete with private industry for top applicants. Senior accountants in public accounting will see the greatest increases in base compensation in 2002. Starting salaries for these professionals are expected to rise by an average of 4.2 percent at medium-sized public accounting firms ($25 million to $250 million in sales), 3.7 percent at small firms (those with up to $25 million in sales) and 3.4 percent at large firms (more than $250 million in sales). Accounting managers also should see gains in average starting salaries, with a projected increase of 3.2 percent at medium-sized public accounting firms and 3.1 percent at large firms.

Specialties with above-average salary growth in 2002 include financial, budget, treasury and cost analysts, according to the research. Analysts with one to three years of experience should see a 5.2 percent gain in base compensation at large companies, with an average salary range of $42,250 to $53,750. Similarly, analysts with one to three years of experience are expected to see average starting salaries of $38,500 to $49,000 at medium-sized firms, an increase of 5.1 percent over 2001. At medium-sized companies, average starting compensation for managers in these specialty areas is projected to rise 4.8 percent to the range of $58,500 and $73,250 annually.

"Financial analysts are in demand as companies adapt to changing market conditions," Messmer said. "These professionals are needed to evaluate business trends and identify strategies that will reduce costs and increase operational efficiency."

While overall increases in starting salary are moderate compared to last year's projections, some of the specialty areas most in demand should still see notable gains. According to the Robert Half and Accountemps 2002 Salary Guide:

Demand for accounting and finance professionals is expected to be strongest in the health care, real estate and financial services industries. However, hiring activity varies significantly by geographic region. (All salaries listed are national averages. A regional analysis of hiring trends and compensation variances is included in the Salary Guide.)

Information in the Salary Guide is derived from the thousands of job searches, negotiations and placements conducted each year by Robert Half recruiting managers. Continuing or ongoing salaries are not reported because too many external factors -- such as seniority, work ethic, job performance and training -- impact the salaries of full-time employees as work histories develop.

Order a free copy of the Robert Half and Accountemps 2002 Salary Guide online at www.roberthalf.com, or by calling 800.474.4253.

accountants top the bean pile.

UK accountants top the bean pile
(c) 2003 Times Newspapers Ltd. By Jon Ashworth.

CHARTERED accountants, famously lampooned in Monty Python sketches, are laughing all the way to the bank, according to a survey that shows

beancounters are the best paid in the world.

accountant with five years' experience typically earns £72,000 a year, against £42,000 in

America

, a country more often associated with bank-busting salaries. The pay of those who are promoted to partner at one of the Big Four accounting firms rockets to about £250,000 - or £13,000 a month after tax.

Mike Rake, chairman of KPMG, was paid £1.7 million last year. Nick Land, UK chairman of Ernst & Young, took home more than £1 million. It is thought that some individuals earn more than £2 million a year, although not all the big firms disclose details of pay.

Andrew Saunders of Management Today magazine, which publishes an annual global salary survey, said: "It's widely assumed that US accountants earn more than the rest of the world, but this is not borne out by the figures.

accountants are consistently more highly paid."

The tables are turned when it comes to boardroom pay, however, with the typical American chief executive earning £1.2million a year compared with a miserly £409,000 for their

counterparts. Company bosses in

Sweden

scrape by on £250,000 a year.

Other research published today reveals the

accounting profession remains overwhelmingly male. As few as one in 11 partners at the big firms is a woman. The biggest

firm, PricewaterhouseCoopers, has 734 male partners and 63 female partners.

Damian Wild, editor of Accountancy Age magazine, said: "Fee income growth may be slowing, but we shouldn't feel too sorry for accountants. Senior accountants are still earning significant sums of money, in six or even seven figures."

Business Management

Chief Executive Officer Salaries

Business & Media - Bosses who shed most staff take top pay packets.

By Heather Connon Investments Editor.
379 words
31 August 2003
The Observer
2
English
© Copyright 2003. The Observer. All rights reserved.

COMPANIES that have the biggest redundancy programmes, highest shortfalls on their pension funds or most generous tax breaks also have the highest-paid bosses, according to startling new research from the

Chief executives who shed the highest number of staff saw their pay rise by an average of 44 per cent, compared with just 6 per cent for US companies in general. That put their average salary at $5.1 million ( £3.2m), almost 40 per cent above the $3.7m average for the 365 largest companies in Business Week's salary survey.

The biggest lay-offs in the survey - conducted by pressure groups the Institute for Policy Studies and United for a Fair Economy - were at Hewlett-Packard, where 25,700 workers were fired. Yet chief executive Carly Fiorina saw her pay jump 231 per cent to $4.1m.

That rise was dwarfed by the 1,612 per cent rise, to $21.2 million, for former AOL Time Warner chief Gerald Levin, who presided over the sacking of 4,380 employees. And Tyco's Dennis Kozlowski took home more than $71m-almost double the previous year's salary - despite being forced out halfway through the year. His company shed 11,300 workers.

The research also found that the 30 companies with the biggest holes in their pension funds paid their chief executives 59 per cent more than the average chief executive in Business Week's survey. The total pay for these 30 chief executives was $352m - an average of almost $12m - and 10 of them saw their pay more than double over the year. Yet their companies' pension deficits climbed to $131 billion.

One of the biggest deficits is at oil company Exxon, where the pension fund is $11.3bn short: its chief executive earned $42.5m last year.

The survey confirms the growing gap between the pay of chief executives and their employees. The authors estimate that the pay of the average chief executive has increased by 279 per cent since 1990, while the average worker earned just 46 per cent more. Chief executives now earn more than 280 times their average employee, compared with 42 times in 1982.

Chief Information Officer

’96-’04 CIO Salary Survey (Janco Associates)

Janco Finds Slide in CIO Compensation Stops -- Demand for IT Professions Stabilizes

418 words
13 January 2004
09:10 am
Business Wire
English
(c) 2004 Business Wire. All Rights Reserved.

PARK CITY, Utah Victor Janulaitis, CEO of Janco Associates ( www.e-janco.com), today released the results of its January 2004 IT Salary Survey and Janco's 1996 to 2004 Comparative IT Salary Survey.

CIO mean compensation has increased for the first time since 2001. In addition, salaries for other top IT positions have also stopped falling and some enterprises are planning on new hiring. Janulaitis said, "For new hires, enterprises are opting for senior experienced staff. This is resulting in increased demand for professionals with more than five years experience. The recovery is first being felt in mid-sized enterprises, those with revenues of $500M or less."

Mean total compensation for chief information officers (CIOs) in large enterprises increased by 1.32% from $165,329 to $167,508 and in mid-sized enterprises by 2.66% from $171,795 to $176,357.

Mean total compensation for all positions surveyed in mid-sized enterprises has moved up to $76,003 in start of 2004 from $75,759 in the last quarter of 2002. At the same time, in large enterprises the median compensation is at $79,338.

Some organizations that had eliminated training, planning and infrastructure positions, such as change control, are beginning the process of limited re-staffing in those areas.

Voice/wireless communication and security positions have been upgraded within many enterprises. Where these positions were lower to mid level positions before 2000, in 2003 and beyond these positions are now mid-level to senior level positions.

Demand is high in the Internet and network areas of e-commerce, voice/wireless communication, object programming, data security and data warehousing as enterprisers try to prepare for the next wave of the new wireless technology.

Individuals who had planned on retiring in 2003 and 2004 and have not recovered from their retirement portfolio's shrinkage are deferring retirement. In interviews, Janco found a significant number of these individuals have focused on staying employed versus looking for increases in compensation.

Both the 2004 IT Salary Survey and the Comparative IT Salary Survey for 1996 to 2004 are available for purchase at www.e-janco.com.

Janco Associates Inc. is an international consulting organization based out of Park City, Utah. Janco offers pre-written templates for Disaster Recovery Plan, Security, Outsourcing and Safety Programs, Job Descriptions, IT Salary Surveys, Metrics, and Internet Policies and Procedures.

Board Directors

DIRECTORS PAID WELL, BUT CHANGES FORCING MORE TO EARN IT

Copyright (c) 2003 Bell & Howell Information and Learning Company. All rights reserved.

Directors were once the bobblehead dolls of the corporate world. Put them in front of a CEO and their heads would pliantly nod in ascent to his recommendations.

But having been slapped silly by regulators and shareholders, the bobbleheads are developing a spine. Evidence of their halting reformation comes from Buck Consultants, part of Mellon Financial's human services business. The firm surveyed 166 U.S. companies with median annual revenue of $1.1 billion, asking them what directors are paid and how they go about their work.

Buck principal Edward Speidel describes boardroom response to the backlash of regulators and investors as cautious. More companies are seeking specific expertise when recruiting directors, expecting them to be more diligent and shunning the clubby practice of interlocking directors, where the chairman or CEO of Company A sits on Company B's board and vice versa.

However, Buck found progress toward more challenging reforms, such as instituting formal evaluations of director performance, much more limited. Smaller- and medium-size companies have been slower to adopt the changes.

"Our survey shows that change is going to be evolutionary, and seems likely to gather momentum over the next few months as additional companies comply with Sarbanes-Oxley," Speidel says.

Among other things, the law requires companies to put a financial expert on the audit committee of their board and gives the ! panel broader duties. According to Buck, the median number of audit committee meetings held last year by the companies it surveyed was six, up from five the previous year. Holding an extra meeting isn't as significant as two other trends: directors are spending more time preparing for the sessions and meetings are lasting longer.

"They have to because they have more responsibilities," says T.K. Kerstetter, president of Board Member Inc., the publisher of Corporate Board Member magazine.

Because expectations are greater, companies want directors to limit their other obligations. Charles Tribbett, managing director of Russell Reynolds Associates, says when clients ask the search firm to identify director candidates, they want people who are on no more than two or three other boards.

Directors, like everyone else, are being asked to work longer and harder. While the rank and file are doing it for flat or reduced wages and fewer benefits, that may not ! be the case for the guardians of shareholder interests.

According to Buck, the median compensation for directors ranges from $80,580 at companies with revenue under $100 million to $127,873 for directors at companies with revenue of more than $10 billion. The pay includes retainers, compensation for committee service, meeting fees, stock and options. Because of their heightened responsibilities, the median retainer for an audit committee chairman is $10,000, vs. $5,500 for compensation committee chairmen and $4,500 for heads of the nominating committee, which hires directors.

The trends are evident even in the backwaters of the Ohio River.

Calgon Carbon increased its annual retainer from $18,000 to $20,000 and pays meeting fees of $1,800, up from $1,500 the previous year. The chairman of its audit committee gets an extra $7,500 vs. $5,000 for other committee chairmen. Audit committee members receive an extra $5,000, $2,000 more than members of other committees.

FreeMarkets, whose stock options aren'! t as alluring as they used to be, started paying directors a cash retainer for the first time this year. Each director receives $50,000 annually except the chairman of its audit committee, who receives $75,000.

PPG Industries pays members of its audit committee a $4,000 retainer in addition to the $45,000 they receive for serving on the board. Members of other committees get an extra $3,000, with committee chairman receiving an additional $1,000.

Alcoa, which has paid directors $150,000 annually since 2001, requires them to invest half of it in its stock. It also requires independent directors to meet at least twice annually without management present.

The stock requirement is counter to Buck's finding that 22 percent of the companies expect to give directors more of their compensation in cash. Speidel says those companies are "in the vanguard of a broader trend toward increasing the cash amount offered to directors."

Given the market's pe! rformance in recent years, that should come as no surprise. B! ut there are less obvious reasons. Tribbett says too much stock could lead directors to make decisions based on short- term factors instead of what's best for shareholders in the long run.

There's an inherent conflict in boardroom reform. Unlike other workers, directors essentially set their own pay. They usually call in an outside consultant to study what similar companies in their industry pay or how world class companies compensate directors.

"That's where the spiral starts a little bit because the consultant wants to make sure they are brought back in," Kerstetter says. "The CEO in each company does play a role ... because it makes the directors feel better. That's sort of their check and balance."

There's no doubt that director paychecks reflect that the stakes for directors are higher than ever. "In a certain way, you almost can't be overpaid with the risk and the job that they have," Kerstetter says.

Still, investors would feel more! comfortable about compensation if they had more of a say in nominating and electing directors. The Securities and Exchange Commission is in the middle of a broad review of this critical issue. Stay tuned.

Len Boselovic can be reached at lboselovic@post-gazette.com or 412-263-1941.

Plastics Seats

(c) 2003 Crain Communications, Inc. All rights reserved.

A seat on the best-paid corporate boards in the plastics industry can bring in $50,000-$60,000 a year, plus stock options and extras like fees to attend board meetings and travel reimbursements. Sitting on the lowest-paid boards, by contrast, means less than $10,000 a year, plus stocks and extras.

That kind of variety can be expected in an industry with a tremendous range in company size, from relatively small $50 million-a-year operations to multibillion-dollar multinationals.

An examination of compensation to boards in the plastics industry shows that most are in the middle, paying from $20,000 to the mid-$30,000 range.

Hexcel Corp., for example, pays its directors $30,000 a year in cash as a base; Atlantis Plastics Inc. offers $32,000; and AEP Industries Inc. pays $20,000. The base is sometimes paid partially in stock, too.

Typically, directors also get fees for attending board and committee meetings, from $500-$1,000 and often get a few hundred to a few thousand shares of company stock or options.

It's a job that's getting more demanding, as a few corporate scandals have forced public and shareholder attention on how well boards are overseeing companies, said Jim Aslaksen, a consultant for executive recruiting firm Spencer Stuart in San Francisco.

Aslaksen, who specializes in recruiting executives and board members in the chemical and plastics ! industry, said board members are expecting to be paid more for the time and risks they're undertaking.

The right balance for board pay is compensation for the effort and risk involved, but not paying them so much that they, in effect, become employees and lose their independence, said Charles Elson, director of the University of Delaware's Weinberg Center for Corporate Governance.

One company, Foamex International Inc., has substantial outside financial arrangements with its directors.

Besides the board retainer of $50,000 a year and stocks, one compensation committee member has a $5,000 a month consulting deal. Another board member, who led the compensation committee for part of 2002, heads a consulting firm that got $455,000 from Foamex in 2002.

And a third board member received a $150,000-a-year consulting contract in 2002 to identify business opportunities in the Pacific Rim.

Foamex's financial deals with its board have attracted criticism in the past from shareholders who question whet! her they compromise the board's independence.

One well-known shareholder, Leon Cooperman, head of Omega Advisors Inc. in New York, said at its 2001 annual meeting that Foamex has a ``disturbing pattern of lucrative financial arrangements between the company and its outside directors.''

He declined to comment on the 2002 deals but said the company has a ``long history of inappropriate'' dealings with board members. Cooperman is a former executive at Goldman, Sachs & Co.

Foamex declined to comment.

The company stands out in the industry for those consulting deals with its board. The vast majority of firms do not have anything similar.

Most directors take their responsibilities seriously and spend at least 12 working days a year on board activities, and often much more, Aslaksen said.

As board service gets more demanding, a few companies have made changes in board compensation.

Myers Industries Inc. decided to r! emove a condition requiring 10 percent return on equity for the board to get more stock options. And Insituform Technologies Inc. decided to award stock grants in addition to options.

Board pay varies greatly, often depending on the size of the firm.

One of the largest companies, Sealed Air Corp., pays its directors $60,000, the highest on our chart, and Newell Rubbermaid Co. compensated its directors $40,000 last year. The company raised that to $50,000 this year.

Small companies like PVC Container Corp. and UFP Technologies Inc. pay $5,000, by comparison.

Summa Industries has what might be the lowest base pay for directors: no annual retainer, $1,000 for each board meeting attended and $1,000 for each committee meeting. But the company offers a healthy option package to directors, granting between 4,000 and 6,000 options a year.

For Summa's board, that has probably worked out well: $100 invested in 1997 was worth $156 in 2002, well above a peer group of firms and the Russell 2000 index. Company officials declined comment.

While pay varies greatly, the adage of getting what you pay for doesn't always seem to apply. A well-paid board does not necessarily mean better returns for shareholders.

Foamex, for example, has not been kind to investors. Its board is among the best paid in our ranking. Yet $100 put into its stock in 1997 would have been worth $29 at the end of 2002.

On the other hand, medical injection molder Merit Medical Systems Inc. pays its board just $12,500 a year, perhaps a bargain when you consider that $100 invested in that company in 1997 would have been worth $498 at the end of 2002.

General Counsel

’03 General Counsel Salaries

General Counsel Salaries Rose in 2003; Supreme Court Refuses to Hear Indian Gambling Case; Pillsbury Winthrop Re-Elects Management Team; Officers Found Justified in Shooting Death; Panel to Discuss New Sentencing Polices

The average general counsel earned a salary of $278,500 in 2003, a 4 percent increase from 2002, according to a survey by law firm consultancy Altman Weil. Salaries were also up slightly for most other in-house lawyers, with the exception of high-level specialists in areas such as tax or international law. Their salaries dropped 7.5 percent from $139,000 in 2002 to $128,600 this year. General counsels also saw a 11.4 percent jump in bonus compensation, up to $179,000 from $160,700. Most other in-house lawyers saw bonuses drop by between 12 percent and 16 percent. Senior attorneys, for instance, received $13,200 in bonuses in 2003, down from $15,000 in 2002. James Wilber, head of Altman Weil's corporate law group, said companies seemed to be trading off salary and bonus compensation for most in-house lawyers. Altman Weil polled 330 corporate law departments and included compensation data for 7,223 lawyers, most of whom worked at companies with more than $1 billion in annual revenues.

Lawyers

Associates

NALP's 2003 Associate Salary Survey

193 words
1 December 2003
Partner's Report for Law Firm Owners
English
Copyright (c) 2003 by the Institute of Management & Administration (IOMA). Reproduction without permission is strictly prohibited.

New compensation data on junior lawyers, courtesy of the National Association for Law Placement's (NALP; Washington, D.C.) 2003 Associate Salary Survey, are outlined in the table below.

Source: PR staff

Median Base Salaries by Associate Year and Firm Size (as of April 1, 2003)

       Number of Attorneys

Associate Year 2        26       51       101      251      501 or   All Sizes

               to 25    to 50    to 100   to 25    to 500   more

First          $ 59,500 $ 71,000 $ 80,000 $ 85,000 $102,000 $113,000 $ 93,190

Second           64,500   75,000   82,800 87,000    105,000  120,000   94,000

Third            67,250   81,000   85,700 92,838    110,000  128,417   99,250

Fourth           72,000   85,000   89,513 95,500    114,000  135,000   105,000

Fifth            81,400   89,000   92,500 100,450   118,900  144,500   110,000

Sixth            95,000   99,000   98,650 104,000   126,125  147,688  120,000

Seventh          95,000   99,750  101,666 110,000   133,250  157,500  120,875

Eighth          106,000  100,000  105,000 110,000   143,150  165,000  124,900

Associate Compensation Stays Stable for Another Year, NALP Data Show

Law Office Management & Administration Report, 1 October 2003

New data from suggest that law firms of all sizes are continuing to take a more "fiscally responsible" approach to compensating first-year associates. It's a stance that law firm leaders are well advised to continue; indeed, it may take the industry some time to recover from the excesses of the late 1990s.

Already, NALP's comparison of figures reported as of April 2002, April 2001, and April 2000 indicate that firms of 251 or more attorneys have kept first-year salaries stable, with a median of about $110,000. This large-firm approach to associate compensation, of course, is in sharp contrast to a 30% increase in the median from April 1999 to April 2000.

In law firms of two to 25 attorneys (25% of respondents are in firms of 50 or fewer attorneys) the median salary for first-year associates came in at $59,500. In contrast, the largest firms surveyed (500 lawyers or more) paid their first years a median salary of $113,000, which brought the first-year median for all participating firms to $93,190.

As you would expect, each year of associate experience brings several thousand dollars in increased compensation: median salaries for eighth-year associates ranged from $106,000 in small firms to $165,000 in the largest firms, with a median for all participating firms of $124,900.

Regional variations. In some major cities, such as Los Angeles and New York City, as well as the Silicon Valley area, the prevailing salary of $125,000 for first-year associates in large firms has remained unchanged since April 2000. Interestingly, salary stability at this level was last experienced almost a decade ago, in the mid-nineties.

The volume of data in this year's survey allowed analyses for 30 individual cities as well as many additional states and regions not encompassed by those cities. The range of law firm compensation the survey revealed was wide. For example: The median salary for first-year associates in all firms of more than 251 attorneys was highest in the West, at $120,000, followed by $117,000 in the Northeast, and $106,000 and $95,000 in the South and Midwest, respectively.

The typical high salary reported was $135,000. The typical salary for first-year associates in large firms stood at $125,000 in a number of cities and regions beyond New York-these include Boston, Chicago, Los Angeles, San Francisco, and the Silicon Valley area. In contrast, medians in smaller metropolitan areas like Columbus, Las Vegas, and Omaha were about $70,000.

Contrasts between large cities and smaller metropolitan areas within the same state are also evident. For example, in firms reporting from areas of California outside the Los Angeles, San Diego, San Francisco, and San Jose areas, the first-year median was $70,000.

Practice variations. NALP's 2003 Associate Salary Survey also gathered practice-specific salary data for intellectual property (IP) attorneys as well as general data on salary levels for staff attorneys and law clerks. Though data on salaries for IP attorneys were more limited, they clearly suggest that these attorneys command salaries $20,000-to-$30,000 higher than average at the junior level, with the difference increasing to $65,000 to $70,000 among senior (seventh-and eighth-year) associates. Additional findings show that salaries for staff attorneys are typically $93,000 per year. Law clerks average $30 per hour.

The survey also reports on bonus systems at participating firms and the prevalence and size of bonuses for prior judicial clerks. Among the findings on bonus systems: About 67% of firms determine eligibility for bonuses on a "discretionary basis." Sixty percent of respondents use "meeting fixed goals" to determine eligibility; of small firms, 42% consider this factor, while about three-quarters of the largest firms do so.

Bonus amounts were based on various factors, the most common of which were merit/performance (76% of offices offering associate bonuses), billable hours (70%), and discretion (50%). About one-quarter of the firms reported paying a bonus to prior judicial clerks, with large firms most likely to offer one. The typical amounts of such bonuses were $10,000 to $15,000.

For more information: A total of 578 offices provided salary information as of April 1, 2003. With 25% of respondents representing firms of 50 or fewer attorneys and 25% representing firms of more than 500 attorneys, the survey report sheds valuable light on the breadth of salary differentials among employers of varying sizes. To purchase, log on to NALP's online book store at www.nalp.org/bookstore/ or call 202-835-1001. Cost: $95.

Attorney Surveys

Less For The Lawyer [Salaries in Sydney, Melbourne, London & NYC]

Perspective
Katherine Towers And Kate Marshall
1710 Words
09 August 2003
Australian Financial Review
29
English
(c) 2003 John Fairfax Holdings Limited. Not available for re-distribution.

The brutal bottom line mentality is now part and parcel of the legal lifestyle. Not all lawyers are happy.

Katherine Sampson , one of Australia's top legal recruiters, says that over the past five years there has been a SeaChange in the Australian legal landscape. Once, the big fish all swam with the biggest firms the firms with the money, the opportunities, the best jobs and all the career-making clients.

But the attraction of the mega-firms is waning as top-performing lawyers search for firms offering that old-fashioned sense of partnership: the collegiate atmosphere that has been swept aside in many firms by the new emphasis on the bottom line.

"People will often take a cut in income to do that to move to an atmosphere where they feel valued," says Sampson, the Victorian managing director of leading legal recruiter Mahlab .

But she says the movement is not only "self-selecting". Partners, who in the past could ride out the tough times on the shoulders of their fellow partners, are now on their own.

"The value of firms has changed as times have become tougher," Sampson says. "Whereas five years ago they would have given people more leeway, or not emphasised the bottom line as much, now they are saying `here is the key performance indicator, you've got to meet it'."

In the case of junior to mid-level solicitors, this new world has come as a rude shock. Three to five years ago many were demanding, and receiving, pay rises of up to 30 per cent. Firm hopping was rife. Even average lawyers were being courted by overseas legal recruiters offering exorbitant salaries to work in New York, London or Hong Kong.

This year, these lawyers, if they are lucky, will get an 8 per cent pay rise, and only if they have met strict performance criteria. It's the smallest pay increase for lawyers in five years.

Yet it's the sudden movement of partners that has surprised the legal recruiters.

According to the latest salary survey of Australian solicitors, released by Mahlab on Friday, there has been a significant increase in the mobility of senior partners in the legal market.

Frustration with firm management and "dissatisfaction with firm culture" were cited by many partners as the main reasons for moving.

"A lot of them are saying `me and the firm are at odds'. They will go to firm! s that are smaller, where they have retained the old sense of partnership in the true sense rather than business," Sampson says. The days when the law partners were the key decision makers the power behind the firm's name have gone. The power has shifted to the lawyer-turned-accountant.

Gone, too, are the long lunches and access to the top shelf of the firm's liquor cabinet.These days, the firms are watching every dollar, and none of the big firms is prepared to carry partners that don't produce the returns.

The lobbies of the top law firms no longer smell of ancient leatherbound law books they smell of money. They have gone from firms with an emphasis on law to corporations with an emphasis on money.

Together, the IT crash, consolidation in the telecommunications and investment banking industries and September 11 were the turning point for law firms. The boom slowed and commercial activity stagnated around the world. Corporate clients, dealing with their own recruitment freezes, became difficult and demanding in turn under pressure from global headquarters wanting more for less. Faced with a commercial downturn, long-time loyal clients were suddenly threatening to cross Collins Street and sign up with competitors. Legal firms had to change the way they did business.

And for many lawyers the result is a much less attractive workplace, Sampson says.

James Young , Australasian practice manager of legal for TMP Hudson , says the change in the economic climate forced firms to enter a consolidation phase and focus on cost reduction.

"A few years ago, Australian firms were riding the crest of a prolonged state of economic growth, speculative planning, due diligence on investments and expanding business," he says. "That growth is no longer, and firms have become much more conservative."

A decade ago, the years spent slaving away were enough to guarantee a seat at the partners' table. Being a good lawyer was enough to win respect. These days you need! so much more. Partnership aspirants have to be excellent lawyers, carry a market reputation and the ability to bring in the big fish and the big bucks. They are no longer practitioners. They are business people.

This change of focus doesn't sit well with those used to the days of the collegiate-style partnerships.

Doug Robertson is one of a growing number of senior partners choosing to end high-flying careers at Australia's top legal firms.

After 10 years as a highly regarded partner at top-tier firm Freehills , he decided to cash in his lucrative position for a chance to join one other lawyer as head of the newly opened Melbourne office of Piper Alderman .

His move from a 210-partner firm to a 32-partner firm was driven by frustration at his lack of input into the direction of the company at Freehills, where, he says, he felt like a "glorified employee".

"Over the past five or six years the collegiate feel that a number of law firms used to have has disappeared," Robertson says. "Now I'm invigorated and feel I know most of the Pipers partners as friends. That's better than at Freehills where after 10 years I hardly knew any of the partners at all. The big law firm had become a slow-moving bureaucracy and it was very frustrating."

Nick Grambas , partner at Freehills, agrees that many partners in top-tier firms are moving to escape growing bureaucracies and to regain autonomy. They want to remember what it is like to make decisions and see them implemented straight away.

Grambas, who this week returned to Freehills after a stint at Mallesons Stephen Jaques , says smaller firms are quick to snap up dissatisfied partners from the larger firms. They are keen to benefit from the added firepower, credibility and attractiveness top-tier partners bring.

"In the legal profession at the moment you have got a lot more pressure on every level of lawyer in the law firm, from senior partner to articled clerk, to meet much stricter key performance! indicators," Sampson says. "There has been a polarised response. The solicitors' or non-partners' response has been: `Gee, I'm glad to have a job and I'll stay where I am.' The response from partners has been: `I hate this environment, this is not the firm that I joined, this is not the firm that I became partner of I'm going to walk."'

According to the Mahlab survey of 2000, demand for junior lawyers, at the three to five-year post-admission stage, far outstripped supply. The mass exodus of young lawyers overseas resulted in firms launching desperate retention policies, offering flexible working hours, laptop computers, gym memberships, massages, and subsidised meals.

There were mass hirings, and firms talked publicly about job prospects and salary bands as they despairingly tried to cling to staff who jumped from firm to firm or flocked to London and New York to take up lucrative job offers and more challenging work.

This year, job prospects and wage levels have become such a sensitive issue that some firms, like Mallesons, are refusing to talk about it.

Junior lawyers are struggling for promotions as the tightening of business practices forces a stronger emphasis on individual performances and a widening gap between high achievers and average performers.

According to the Mahlab survey, firms have adopted stricter qualifying criteria for salary increases and promotions and recruit only when existing resources and staff can't fill a hole.

"A particular trend this year has been a strong focus on managing costs and performance within businesses, with a particular drive to ensure all staff work effectively and efficiently," the survey says.

"There have been fewer promotion opportunities than in previous years, particularly at partnership levels."

Salary rates are also being kept down by the flood of Australian lawyers returning home after riding the boom overseas.

But the returning lawyers, who graduated, worked and left Aust! ralia all in the boom times, have come back to a harsher place.

Where once a senior lawyer who had worked in London or New York was virtually guaranteed a job, now they are facing short periods of unemployment.

"A senior lawyer coming back from London with great corporate and financial experience would have had 10 offers from the 10 biggest firms three or four years ago," Sampson says. "Now they would be lucky to get one."

A LEGAL REWARD

Top-tier firms Sydney

Years since graduation    Range                   Average

Graduate                $50,000 - $60,000        $54,000

1                       $52,000 - $72,000        $62,000

2                       $59,000 - $85,000        $70,000

3                       $70,000 - $120,000       $87,000

4                       $87,000 - $124,000       $103,500

5                       $85,000 - $160,000       $115,000

6                       $90,000 - $190,000       $120,000

7-10 years              $105,000 - $230,000     $146,000

10+ years               $130,000 - $265,000     $175,000

Top-tier firms Melbourne

Years since graduation  Range                   Average

1                       $50,000 - $65,000        $58,000

2                       $54,000 - $80,000        $70,000

3                       $56,500 - $87,000        $85,000

4                       $70,000 - $106,000       $90,000

5                       $76,5000 - $115,000     $96,000

6                       $82,000 - $132,000       $120,000

7-10 years              $100,000 - $220,000     $140,000

10+ years               $120,000 - $220,000     $155,000

London salaries

Year level              Range

Newly Qualified         £48,000 - £50,000

PQE 1                   £51,000 - £55,000

2                       £56,000 - £63,000

3                       £60,000 - £70,000

4                       £63,000 - £75,000

5                       £76,000+

New York salaries

Year level              Range

Newly Qualified         $US115,000 - $US140,000

PQE 1                   $US125,000 - $US160,000

2                       $US130,000 - $US170,000

3                       $US150,000 - $US180,000

4                       $US165,000 - $US200,000

5                       $US175,000 - $US212,000

Source: William M Mercer

[Bay Area] ASSOCIATE SALARY SURVEY Diminished Expectations.

Salaries and bonuses are static, but as long as associates have jobs, they don't seem to be complaining

Even the greediest of associates has been humbled by the economic downturn. With so many lawyers looking for work, salary rarely comes up in job interviews - a big change from the days when money was topic No. 1 for prospective associates, Bay Area hiring partners say.

These days, candidates would rather talk about the firm's debt load, real estate liabilities and long-term stability.

"Think about the era these associates have lived through," said Anthony de Alcuaz, the managing partner of McDermott, Will & Emery's Palo Alto office. He then ticked off the firms that have dissolved since Jan. 1 - Brobeck, Phleger & Harrison, Skjerven Morrill and Altheimer & Gray, just to name a few.

"In the high times, the underlying stability of the firm was not a question that came up," de Alcuaz said. "It is a different time."

For the third straight year, base pay is flat for Bay Area associates, a Recorder survey of associate salaries shows. And many law firm managers at local and national firms don't expect that to change next year either. What's more, associates don't seem anxious to press the issue, a major shift from early 2000 when associates created a Web site to pressure partners at their firms to raise salaries.

"Relative to a lot of people in the Valley, we're very well paid," said one mid-level associate at Wilson Sonsini Goodrich & Rosati, who spoke on condition of anonymity. "The fact there haven't been any salary reductions is good."

The Recorder's annual survey examines associate compensation - including base pay, bonuses and benefits - at a cross-section of firms with offices in the region. The results show that not only is base pay static, but bonuses - which grew to $60,000 or more for senior associates at some firms during the tech boom - have declined as well. Gone, for example, is the $20,000 guaranteed bonus that most tech firms paid first-year associates in 1999 and 2000. After the boom ended, firms backed away from the promise in lieu of smaller, discretionary rewards.

"People think it makes sense," a mid-level Skadden, Arps, Slate, Meagher & Flom associate said. "It's an economic reality."

Partners apparently feel the same way. They said they aren't willing to boost salaries as long as the market is flooded with job hunters.

"It's dependent on the economy," said Karen Ballack, one of the hiring partners at Weil, Gotshal & Manges in Silicon Valley. "So long as there are plenty of talented candidates on the market, I think none of the firms are going to be incentivized to raise the base salaries."

Still, Bay Area associates aren't that far behind their peers in New York, traditionally the gold standard for lawyer pay. Most New York and Bay Area firms are sticking to $125,000 in base pay for first-year associates. The exception to the rule is Skadden, Arps. The New York-based behemoth pays first-year associates $140,000. Five years ago, West Coast players paid about $9,000 a year less, on average, than New York firms.

New York firms, however, may be better equipped to handle the pay. They don't seem to be suffering as much from the downturn. And if they chose to give raises, Bay Area counterparts would be hard-pressed to follow.

"In today's economy, and given the difference generally in the client base between many N.Y. firms and local firms, it may mean they are performing better," Ballack said. "As long as that continues to be the case, there will continue to be a gap" in pay.

But Morrison & Foerster Chairman Keith Wetmore said Bay Area firms aren't feeling much pressure right now to keep up. Not only is the job market saturated, but New Yorkers currently don't have a voracious appetite for associates.

"They're less of a competitive influence today than any time I can remember," Wetmore said.

The single biggest jump in associate pay came in December 1999 when Gunderson Dettmer Stough Villeneuve Franklin & Hachigian gave its associates a 30 percent pay raise, bumping first-year base pay from $96,000 to its current base of $125,000. Under pressure from associates, other Bay Area firms agreed to match. In the months that followed, many of the New York and national firms followed suit.

John Wilson, managing partner of Shearman & Sterling's Bay Area offices, said his firm had bumped first-year pay from $95,000 to $100,000 just one month before, and then had to increase it again to match the Bay Area firms.

In hindsight, the increase in associate pay came at the worst possible time, Wilson said, coming just months before technology stocks started to fall in value.

"Events like the Gunderson pop pulled the whole industry along at precisely the wrong moment," Wilson said. "Law firms had to deal with those salaries during the downturn."

And Wetmore acknowledged that "the salary increases did have a Darwinian effect in causing some firms to collapse, and indeed, it had a hand in creating high cost structures."

For his role in helping to create today's law firm economics, Robert Gunderson Jr., a co-founder of Gunderson Dettmer, is unrepentant.

"We certainly don't regret what we did in '99," Gunderson said. "It was a response to the market conditions at the time, and I think what's happening in today's market is sensible, as well, in terms of the changed conditions."

But Gunderson held off making predictions similar to other managers that salaries would be flat for the next year or two. "The last couple of years have shown that you have to expect the unexpected," Gunderson said.

He may have a point. Three years ago, no one would have expected that associates would stop asking about salary. Today, most would-be hires don't even mention pay, said Avis Caravello, a San Francisco legal recruiter.

"Three years ago, it was one of the more important aspects of the conversation," Caravello said. "Now, if salary comes up, it comes up in the context of the candidate telling me they are flexible, they're willing to reclassify and take a step back for the right position and that salary isn't everything."

And law firm managers point out that many associates are still making more money this year than they did last year. Orrick, Herrington & Sutcliffe Chairman Ralph Baxter Jr. said associates are getting raises in the form of step increases as they progress up the seniority ladder.

"Your income is going to go up even if the amount articulated for each level is flat," Baxter said.

Until things loosen up in the economy, many managers won't feel pressure to bump base salaries, Baxter said.

"It's not so much 'you're lucky to have a job.' It's the dynamics of the market," Baxter said. "It's not as though associates are facing flat incomes with sharply rising costs."

’03 General Counsel Salaries

Government Attorneys

County Counsel Compensation

Santa Clara leads in pay, size among Bay Area county counsel

When it comes to county counsel offices in the Bay Area, there's Santa Clara, and there's everybody else.

With 137 lawyers and staff, Santa Clara's county counsel office is almost three times the size of the next largest, in Contra Costa County, which has 48 lawyers and staff.

Santa Clara's county counsel office is not only bigger, it pays more - much more. Across its three large-county rivals - Alameda, Contra Costa and San Francisco - there is a $17,591 gap. At the top, Santa Clara's entry-level deputy county counsel make $77,911, while at the low end, Alameda pays $60,320, a 29 percent difference.

San Francisco's county counsel is City Attorney Dennis Herrera, whose office has a different scope of responsibility and, at 340 attorneys and staff, a different scale than most county counsel offices. While contrasting the office's size to other county counsel is somewhat of an apples-and-oranges comparison, San Francisco's city attorney pay scale is on par with the other county counsel.

Th! e entry-level pay range for county counsel is significantly larger than the range found among district attorneys and public defenders in the four largest counties. For entry-level DAs, $11,658 separated the highest paid from the lowest, and the difference was just under $15,000 for junior public defenders.

Among the top posts, the difference in pay gets even larger. With a $221,227 salary, Santa Clara County Counsel Ann Ravel bring in $64,551 or 41 percent, more than the lowest paid among the four large counties, Herrera in San Francisco who earns $156,676.

For senior deputy county counsel, those without managerial responsibilities, the salary range tightens in the four largest counties. Santa Clara has the highest starting pay for senior counsel at $125,101. Contra Costa's $113,172 is the lowest of the four.

Santa Clara's Ravel said the high salaries in her county can be traced back to two circumstances that make the county unique.

The first is the cost of living. Ravel says that although the Bar Area in general is an expensive place to live, Santa Clara has "clearly surpassed" most other counties.

Another reason for the high salaries is a county rule requiring salaries to remain "commensurate with those prevailing throughout the county for comparable work." Comparable with whom was the subject of several trials in the 1980s and 1990s. The Santa Clara County Superior Court eventually ruled that comparable included private attorneys and not just other public employees. That ruling allowed the unions representing the county's public attorneys to negotiate a series of raises, including a 15.5 percent boost in 2002.

But California's fiscal crisis has put more raises in limbo in Santa Clara and raised the specter of staffing cuts.

"We will be doing another round of budget cuts in October and it will be inevitable that there will be layoffs," Ravel said. "At the moment, we are out of options."

Ravel says the Board of Supervisors has not d! ecided on the size of the cut to her office, but she expects it to be in the range of $250,000 to $300,000.

Alameda County's starting salary of $60,320 is not competitive, County Counsel Richard Winnie acknowledged. But he said wider salary ranges and broader job definitions than in other counties give him flexibility when bringing in new staff.

"We fill gaps in our office," Winnie said. Deep classifications "give us the flexibility of finding people with growth potential, people who want to expand their practices."

Winnie says there are other benefits to working in Alameda not captured in the salary survey. "There is a real advantage to not crossing the bridge or driving down [Interstate] 80 every day."

While Solano County has the lowest starting pay on the chart, $47,735, its pay is more competitive further up the ranks. Senior pay in Solano, at $92,092, tops Napa's, Sonoma's and Santa Cruz's. And Solano County Counsel Dennis Bunting, wi! th an annual salary of $162,252, makes more than the county c! ounsel in four counties: Napa, San Francisco, Sonoma and Santa Cruz.

Solano is also neck and neck with Napa for smallest office; Solano has 18 while Napa has 17.3 lawyers and staff. While Marin, with 24, and Santa Cruz, with 21, have small offices, too, six other Bay Area county counsel offices are at least double the size of Solano's and Napa's.

In Contra Costa, the county counsel office not only has the second-highest starting salary, at $71,964, it has something Santa Clara doesn't have: job openings to replace two recent retirees.

"I have a hunch we'll have a good-sized applicant pool," Contra Costa County Counsel Silvano Marchesi said.

Bad times have not spared the office, though. Marchesi has already trimmed his budget twice, by 10 percent and 5 percent, though he has so far avoided layoffs.

In the 1990s, Marchesi said, many young lawyers didn't even know that Contra Costa was in the Bay Area.

"San Francisco is the ! place most people would like to work," he said, in part because "the lunches are better."

"Times seem to be a little different now."

Lobbyists and Trade Association CEOs

’04 CEO Compensation Higher At Associations And Policy Non-Profits [summary]

o Most CEOs of trade associations and other policy-related non-profits in Washington saw their compensation packages increase healthily between 2000 and 2002 -- despite an economic downturn, two wars and a rash of corporate scandals, according to the seventh biennial salary survey conducted by National Journal. The survey, to be published in Friday's issue of the magazine, is based on compensation figures for FY02 that were disclosed in publicly available tax returns. According to the survey, 32 associations CEOs were paid upwards of $1 million in salary and benefits -- the second survey in a row that the number of millionaires nearly doubled. In addition, 120 CEOs earned more than $500,000, up from 98 two years ago and 60 four years ago. Roughly half of all CEOs received salary bumps of 12 percent or more from 2000-02.

These increases came despite the fact that just over half of the 575 organizations studied reported deficits in 2002, compared to less than one-third that were in the red in 2000. The organizations surveyed include trade groups, interest groups, labor unions, think tanks and major charities with a presence in Washington.

2004 Biennial Survey of Association CEO Salaries (National Journal)

In March 2002, the last time National Journal published a biennial survey of association CEO salaries, we concluded that executive compensation would probably plateau for a while.

After all, there was a nationwide recession, a high-tech flameout, a stock market slide, the beginning of a war on terror, a period of low inflation, and a series of corporate-governance scandals. And all of this, both we and analysts reasoned, would conspire to rein in the compensation packages awarded to the heads of Washington trade associations, interest groups, think tanks, and labor unions.

Back then, Eric Vautour, who heads the Washington office of the head-hunting firm Russell Reynolds Associates, predicted that when our 2004 survey appeared -- documenting the paychecks and benefits doled out to CEOs in the dark days of 2001 and 2002 -- the story would have a headline very different from "Soaring Salaries," which topped our 2002 article. "I bet you will see a real leveling-off," Vautour told us. "The industry guys on the association boards are saying, 'We're strapped to pay our dues, so you're going to have to get leaner and meaner.' "

Well, it might have been a smarter bet to buy the Brooklyn Bridge, because when we tallied the numbers for this salary survey, it was clear that we -- and the experts -- were wrong. Rather than leveling off, the salaries of association chief executives continued to climb through the bleak economic times.

For our second survey in a row, the number of CEOs who pulled down $1 million or more in salary and benefits nearly doubled. For fiscal 2002, our survey uncovered 32 millionaires -- up from 18 in 2000 and nine in 1998. The number of executives earning more than $500,000 in total compensation rose to 120, up from 98 in 2000 and 60 in 1998. (See charts for the full distribution, p. 522.)

But life isn't sweet only among the CEOs who were paid the most: The pattern of pay raises seen between 2000 and 2002 duplicates, with almost eerie consistency, the pattern that prevailed from 1998 to 2000. In both periods, essentially half of all CEOs studied in our surveys received raises of more than 12 percent over a two-year period. When this group is sorted further by the size of their pay hikes, the patterns from 1998 to 2000 and from 2000 to 2002 match up almost perfectly.

The bottom line is that the overwhelming majority of compensation packages in Washington for top officials of associations and other nonprofits didn't drop during the downturn in the early years of this decade; in fact, the rate of increase didn't even slow down. The pay hikes chugged right along -- despite the tough budgetary pressures that many organizations faced between 2000 and 2002.

In fact, just over half of the 575 organizations listed in the current National Journal survey reported deficits on their most recent filings with the Internal Revenue Service. By contrast, less than one-third of the groups had reported being in the red two years earlier. Similar patterns prevailed for revenue growth. More than half of the groups in this year's survey reported a decline in revenues between 2000 and 2002. During the boom period of 1998 to 2000, only 29 percent reported a decline.

Apprised of these findings, a chastened Vautour said he was amazed at the upward spiral of CEO salaries, especially for those chief executives with the biggest pay and benefit packages. "I did think that compensation would plateau, and for the bulk of groups it probably has," he said. "But you have 50 or 100 top CEOs whose pay continues to rise, and they are really driving the market."

Others agree. Leonard Pfeiffer IV, who runs Leonard Pfeiffer & Co., a Washington-based head-hunting firm, has found that his association clients are consistently willing to bust their budgets to snag the right chief executive. "Everyone always talks about how low their budget is going to be, but they also want to hire the best of the best," Pfeiffer said. "They've almost always concluded that it's more important to have the right captain running the ship than to worry about that captain having to run a smaller ship."

Another jolt to the system could be coming. If the Pharmaceutical Research and Manufacturers of America hires Rep. Billy Tauzin, R-La., as its CEO for the widely reported price tag of more than $2 million, Tauzin would leap to the top, or close to the top, of the list of highest-paid association CEOs in Washington. Tauzin, who recently resigned as chairman of the powerful House Energy and Commerce Committee, has announced that he is retiring from Congress, but he has so far been silent on whether he is going to work for PhRMA.

For a sense of context, consider that if Tauzin receives a compensation package north of $2 million, he would, in his rookie year as a trade group CEO, be doubling the package it took the widely respected Jack Valenti almost four decades to achieve at the Motion Picture Association of America. If the Tauzin deal is consummated, "every CEO is going to go back to their board and say, 'What does he bring to the party that I don't have?' " said Leslie Hortum, who leads the association and public policy practice for the head-hunting firm Spencer Stuart.

The wooing of Tauzin -- combined with top associations' efforts to recruit Sen. John Breaux, D-La., and the hiring of former Kansas Gov. Bill Graves, former Oklahoma Gov. Frank Keating, and former Oklahoma Rep. Steve Largent, to run three powerful trade groups -- suggests that heading a trade association, once considered a less prestigious post than being a partner at a major law firm or serving in a top corporate slot, has hit the big time.

"In the old days, the head of an association used to be called 'the secretary,' " said Steven Anderson, the $693,230-a-year president and CEO of the National Restaurant Association. "Then it became 'executive director,' and now it's 'CEO.' It really tells you something about the stature of associations." (See story on the associations' race to hire members of Congress as their CEOs, p. 530.)

Analysts offer a variety of explanations for the continuing rise of salaries during tough economic times. One factor has been that some recession-battered corporations have closed or downsized their Washington offices. With fewer in-house eyes and ears on the Washington watch, these companies have been forced to rely more heavily on their industry's association, thus making a good argument for increasing the trade group CEO's compensation. Another factor, some say, has been an especially busy period of lawmaking in Washington, brought about by an unprecedented one-two punch: a new Republican administration eager to reshape entire sectors of the economy, such as energy and health care, and the sudden focus on homeland security, which in one way or another touches virtually every industry.

"Fighting your way through the toughest times is the most valuable service you can give your members," said Carl Feldbaum, the $872,827-a-year head of the Biotechnology Industry Organization. "Those perceived to have traversed that period successfully tend to get compensated for it."

Other factors have played a role, too. The well-documented pressure from Congress and the White House to put loyal Republicans in charge of industry groups has given associations a strong reason to look for new CEOs. In the past three years, Republicans hired to lead high-profile trade associations included Graves at the American Trucking Associations; Keating at the American Council of Life Insurers; Largent at the Cellular Telecommunications & Internet Association; Mitch Bainwol at the Recording Industry Association of America; Walter McCormick at the U.S. Telecom Association; and Robert Rusbuldt at the Independent Insurance Agents & Brokers of America.

About one of every three CEOs (10 out of 32) who got a $1 million-plus pay package in 2002 has a Republican political pedigree. Seven served at some point in their careers for the Nixon, Ford, Reagan, or Bush I administrations. One was a GOP congressman, one worked for the Republican National Committee, and another was a senior Republican aide in the Senate.

The rush to hire Republicans has placed a premium on applicants who can boast strong ties to the GOP. To attract the CEO they want, groups must now compete against any number of lobbying and law firms that are eager to attract their own well-connected Republicans from a relatively small pool, noted David Rehr, the $370,212-a-year president of the National Beer Wholesalers Association.

This bull market has been so strong that it has reversed the typical compensation pattern that used to prevail when a new CEO -- at least at the biggest and most prominent groups -- took over from a long-serving predecessor. "It used to be that the successor was initially paid less than the predecessor was," because of the new person's lack of experience in the job, Vautour said. "Now, they are getting paid amounts that are equivalent to, and sometimes higher than, what their predecessor earned."

Another factor that has pushed salaries upward, experts say, is an arms-race mentality spawned in part by the very existence of National Journal's compensation survey. This year's survey, our seventh since 1990, is based on figures reported to the IRS and the Labor Department by associations, interest groups, think tanks, labor unions, and other nonprofits. These nonprofits file Form 990 -- in the case of labor unions, it's Form LM-2 -- which must be made available to the public upon request. To be included in National Journal's survey, an organization must either be headquartered in Washington or have a substantial operation here.

Every headhunter interviewed for this story said that the National Journal list has come to play a key role in setting salary levels in Washington. For association CEOs -- and for those who hope to join them -- the survey offers invaluable leverage in salary negotiations that they would not otherwise have. "Most association executives have a copy of the survey locked in their left-hand bottom drawer," said Anderson of the National Restaurant Association.

To be sure, the jobs that come with these impressive pay packages aren't child's play. "The boards of directors increasingly want individuals who not only have social skills and who are effective in dealing with the media, but who also are very comfortable with the substance of their field," said Karen Ignagni, the $794,361-a-year president of the newly merged health insurance association AAHP-HIAA. "In that respect, these are very hard jobs. You're expected to be on top of the business, the policy, and have a strong strategic sense of how to lead the association."

Moreover, the pay scale for heading a Washington trade group is actually more modest than that for top executives of individual companies. Because many who sit on association boards are royally compensated as corporate CEOs, they may not think twice about giving their association's CEO a sizable compensation package. "If an association can get a senior person who understands the business and the legislative process, that person can pay for themselves many times over," said Nels Olson, the head of the Washington office of executive search firm Korn/Ferry. After all, as one headhunter put it, the salary of an association CEO "is an afternoon's rounding error for many of these industries."

Because of filing deadlines and extensions, the data in our survey reflects salaries paid two years, and sometimes three years, before our publication date -- just one of many caveats that must be raised about the figures reported here. Calculating rates of increase, for instance, is often tricky. A CEO's salary may seem unusually small in one year's filing because he or she either joined or left the organization during the year and thus was paid for only part of the 12-month period covered by the group's Form 990.

And it isn't only the roster of CEOs that changes from year to year. So, too, does the universe of organizations we have studied. To make our list more comprehensive, we collected 575 forms this year -- 15 percent more than the number we surveyed two years ago, and almost 42 percent more than we collected in 2000. In presenting our findings, we have tried to keep these and other variations from skewing the data.

One caveat has to do with big lump-sum payouts. Three prominent CEOs -- such as Raymond D. Fowler of the American Psychological Association, Carol Hallett of the Air Transport Association of America, and Bernadine Healy of the American National Red Cross -- each received large lump-sum payments before their departure from their organizations. And as in past surveys, many of the top-earning CEOs on our list were given onetime payouts during the year, typically because of the vesting of a deferred-compensation plan. This year, a number of CEOs experienced this sort of income spike; they included David Belden of the American Society of Mechanical Engineers, Jack Faris of the National Federation of Independent Business, Jack N. Gerard of the National Mining Association, Jerry Jasinowski of the National Association of Manufacturers, Barry C. Melancon of the American Institute of Certified Public Accountants, and David N. Parker of the American Gas Association.

A few CEOs received big onetime payouts for other reasons. Before CTIA's Thomas Wheeler was succeeded by Largent, he reaped a windfall from the sale of an affiliate called CIBERNET that pushed Wheeler's million-dollar-plus package past $2 million. At the Business Roundtable, not only did President John Castellani get a hefty baseline raise over what his predecessor, Samuel L. Maury, earned, but he also received $500,000 to cover his relocation costs.

Technically, the biggest percentage increase between 2000 and 2002 was chalked up by none other than Grover Norquist, the outspoken head of the conservative group Americans for Tax Reform. Norquist racked up an almost comically large 4,194 percent increase -- from $4,800 in 2000 to $206,126 in 2002. However, a spokesman explained that Norquist pays his own salary from whatever is left in ATR's kitty at the end of the year. During lean years, Norquist underpays himself and then makes up for his shortfall during years when the group has more money left over.

In a few cases, CEOs got big increases in 2002 because they forswore raises in previous years. Al From, the head of the Democratic Leadership Council, saw his compensation package increase from $228,306 in 2000 to $383,653 in 2002 -- a 68 percent jump. But a spokeswoman said that the bump followed a period in which From remained at the same salary from 1993 to 2001. At the Nature Conservancy, Steven J. McCormick was paid just a hair under $400,000 in compensation in 2002 -- roughly twice what his predecessor, the late John C. Sawhill, earned. "During his entire time, [Sawhill] never requested a raise," said spokeswoman Jordan Peavey. "The board offered him raises several times, but he never accepted." When Sawhill died, the board knew that his successor was going to come with a significantly higher price tag.

At some organizations, the CEO's compensation package has shrunk since our last survey. Occasionally, recession-related belt-tightening influenced these declines. More often, an association paid an incoming CEO for only part of the most recent year reported. In other cases, groups gave a long-term chief a big onetime payout two years earlier, thus artificially skewing the prior year's numbers. At least a dozen CEOs, from BIO's Feldbaum to the American Society of Travel Agents' William Maloney, experienced such "declines" between 2000 and 2002.

All told, the current survey features a surge of new millionaires. Judged by salary alone -- that is, not counting benefits and allowances -- the number of millionaires grew to 16, compared with seven in the survey done two years ago. This year, Eugene Upshaw Jr., the executive director of the National Football League Players Association, was the highest finisher based on salary alone. Upshaw earned a salary of $2,730,046 in 2002, compared with $1,400,000 in 2000, when he ranked third, and $1,800,000 in 1998, when he ranked first.

When all the reported compensation streams are put together, however, Upshaw's paycheck looks relatively puny, at least compared with that of Robert R. Glauber, chairman of the National Association of Securities Dealers. NASD is the regulator of the NASDAQ stock market, and it is a group whose pay scales have historically hewed more closely to Wall Street's than to Washington's. In this, his first-ever National Journal survey appearance, Glauber racked up a salary of $2,099,909, ranking him fourth overall. More strikingly, his entire pay package totaled $9,430,647 -- a figure more than 50 percent higher than the record-setting $6,090,187 paid to Glauber's predecessor, Frank G. Zarb, reported in our survey two years ago. (See box, p. 525.)

Other CEOs in the current survey who earned more than $1 million in salary and bonus alone -- and who appear to have crossed that threshold not solely because of a one-time bump -- include Thomas J. Donohue of the U.S. Chamber of Commerce, Valenti of the MPAA, Hilary Rosen of the Recording Industry Association of America, Robert Sachs of the National Cable and Telecommunications Association, and Robert E. Vagley of the American Insurance Association.

Those CEOs with total packages worth more than $1 million include lots of familiar names: Steve Bartlett of the Financial Services Roundtable; Red Cavaney of the American Petroleum Institute; Peter Cressy of the Distilled Spirits Council of the United States; Richard J. Davidson of the American Hospital Association; Frank Fahrenkopf Jr. of the American Gaming Association; Jack Faris of the National Federation of Independent Business; Matthew P. Fink of the Investment Company Institute; Edward O. Fritts of the National Association of Broadcasters; Craig Fuller of the National Association of Chain Drug Stores; Alan F. Holmer of PhRMA; Frank J. Iarossi of the American Bureau of Shipping; Jerry Jasinowski of the National Association of Manufacturers; E. Edward Kavanaugh of the Cosmetic, Toiletry, and Fragrance Association; and Thomas R. Kuhn of the Edison Electric Institute.

Here's a listing, in descending order, of median compensation by sector. As usual, such fields as finance, communications, manufacturing, transportation, and defense far outpace think tanks, labor unions, educational organizations, and single-interest advocacy groups. The following figures include benefits and deferred compensation.

Britain and U.S. top fat cat league.

15 Highest Paid Women in U.S.

Fund managers, bankers serving rich get poorer-survey Reuters

’03 Univ of Texas Investment Managers (UTIMCO)

UK accountants top the bean pile.

County Counsel Compensation

Fund managers, bankers serving rich get poorer-survey

Reuters