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Executive Compensation & Severance



The Riley Guide: Salary Guides & Guidance

If you've reached the executive level – or are planning on gunning for an executive position – a lot of questions can factor into your strategy. What kind of compensation package should you ask for – and what data can you use to generate a reasonable request? Quite a few websites exist to help you answer questions like these – and many of these sites are regularly updated with the salaries and packages of executives at well-known companies, as well as more general data on executives in various industries, at various levels. While you're at it, you may also want to check out The Riley Guide's page of General Salary & Compensation Information, and our list of links to information on employment and compensation law. And if you're ready to dive deeper into the web's other resources on executive compensation and severance packages, read on.

Executive Compensation Databases

The Internet abounds with guides on executive compensation – some of which gather their data from publicly available sources, while others conduct their own private research. Some offer their findings for free to the general public, while others charge a fee. And while some take the form of searchable databases, others specialize in case reports on particular executives and industries. In this section, you'll find some of the most useful ones on the web.

The Crystal Report on Executive Compensation is a list of articles that analyze compensation for chief execs from a variety of viewpoints. In some cases, the reports look at a particular executive, while others examine the compensation practices of a particular group – and still others look at pay practices in general. Though some of the in-depth reports do require a fee (which may be worth it for you), you can read several of them for free.

Online guides to executive compensation take a variety of forms…

The United States Securities and Exchange Commission (SEC) provides the EDGAR Database of Corporate Information, a database of compensation for the top executives and members of the board of directors of every publicly traded company in the United States – all of which are required to be reported to the SEC by federal law. While some fee-based EDGAR services will pull this information out for you, it's not difficult to find it yourself using the site's searchable database, by following these steps:

  • Select two or three competitive companies similar in size and industry to your preferred employer.
  • Go to EDGAR's "Search for Company Filings" and use the "Company & Other Filers" area to search EDGAR for the each company.
  • Select the most recent DEF 14A form for each company.
  • Use the "Find" command in your web browser (usually by pressing Ctrl-F) and type in the word "compensation" to scan each DEF 14A form for this section.

Not only will this reveal salary and stock information – it also may give you some ideas for additional compensation considerations, like cars, travel expenses for your spouse or partner when you travel, cell phones and more. The SEC also provides a guide called Executive Compensation: Where to Find in SEC Reports, which is designed to help you locate this information in company reports.

FindLaw.com, meanwhile, provides a searchable database of copies of actual employment, severance and compensation agreements from various companies – including compensation information. Just select a type of agreement to review, then look over the list and select the contracts you want to review. This list also includes noncompete agreements, in case you're interested to find out more about what various companies expect in that department.

Reports From Publications

In addition to the databases above, a number of publications provide more detailed analyses of specific compensation packages from various companies – and even for specific executives. These can serve as very helpful supplements to your more statistical research, as they often also include reports on a given executive's job duties, his or her time with the company, and how his or her pay compares to that of other specific executives in the same industry. Plus, it's always handy to have some inside knowledge of your competition.

Case studies of specific executives' compensation can be extra helpful for several reasons…

BusinessWeek.com, for example, presents frequent articles on management and executive salaries throughout the year. To start your search in their site, head to their Career area, then use their Search feature and search for terms like "executive pay", "CEO pay" and "compensation" to find reports and articles from all over the site. Some content on Business Week's web site is for subscribers only, but a lot of it is open to the public.

Forbes.com also offers an extensive library of articles on executive compensation, which is updated every year. The best way to find these is simply to search their site for "executive compensation" and skim your search results for reports that relate to your own questions. Unfortunately, Forbes is now requiring readers to register to read many of the articles on their web site – but it's free, you don't have to give them your name, and you'll only get their e-newsletters if you decide to check those boxes.

Another handy resource from Forbes is their library of "What the Boss Makes" articles, which include company names, names of individual execs, rank by total compensation, state, and industry. Each entry includes a brief bio for each executive surveyed, along with data for the last several years of his or her tenure. You can also click on executive's name for a slightly expanded review of his/her compensation and how it compares to industry medians.

Severance Packages

Sometimes it's just time to move on – even from a profitable executive position. The good news for you is that many executive positions come with the option to negotiate a severance package – and if you negotiate well, you may be able to provide for yourself and your family while you transition into a role at another company. Thus, this section is designed to give you some idea of how severance packages work, as well as how to negotiate severance – either at the beginning or end of your tenure with an employer.

You should always try to negotiate an executive severance package, even in the case of a layoff…

While it can be difficult to negotiate a severance package if you're part of a large layoff, you should still try, especially if you've been with the organization for a long time. Here's a list of tips for hashing out the details of your severance package:

  • Take some time to digest your company's severance offer, if you receive one.
  • Always negotiate for a better deal before you sign anything.
  • Never sign anything without consulting a professional, even if it is just a coach or counselor.
  • If the company asks you to sign a noncompete agreement, they must offer you sufficient compensation to cover the time period stipulated in that agreement.
  • Get your severance package in writing.
  • Be careful about your behavior in the hours surrounding your actual departure – no matter how you're feeling about the company in those moments, they can make or break your long-term professional reputation.
  • Above all, exit the company on good terms. You never know who might speak about you in a meeting somewhere down the road – in a positive or negative light – or who might someday serve as a reference.

Keep these tips in mind, and you'll stand a much better chance of negotiations a severance package that's fair to you – because, as you know, the company will push hard for the better end of the deal, especially if you're on the way out.

If you'd like to check out some more detailed write-ups on these pointers, Susan Adams of Forbes.com has written a nice article called How To Negotiate Severance, which covers some of these basics. Cover-Letters.com also offers an article with tips on how to Negotiate a Fair Termination Settlement.

You may also want to take a look at CareerProtection.com, a company that can assist you with negotiations after a layoff or other termination, as well as when you're considering a new job offer. Their website has some good information for you to review (FAQ under each topic) before you call them about your own situation – including a nice little article titled "The 8 Biggest Severance Mistakes."

Helpful links

EDGAR Database of Corporate Information — Huge searchable database of executive compensation from the U.S. Securities and Exchange Commission (SEC).

Forbes Executive Compensation — Annual survey of compensation packages for executives in a variety of industries.

How To Negotiate Severance — Lots of tips on what to do – and what not to do – as you're hashing out the details of your severance package.


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