May 29, 2023

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Nationally, CEO pay in 2021 reached historic highs for the second year in a row, and Virginia was no exception to this trend.
The CEOs of Virginia’s largest publicly traded companies were rewarded handsomely last year, with CEO compensation rising 4.9% year-over-year to an average $8.467 million compensation package, compared with $8.068 million in 2020.
CEO compensation data was gleaned from an annual study conducted by Equilar Inc., a California-based corporate leadership data firm. To determine executive pay, Equilar tallies salary, bonus, perks, stock awards, stock option awards, long-term awards and other compensation. Altogether, Equilar examined CEO compensation data for 56 Virginia-based public companies with annual revenues of $1 billion or more. (See data for the top 40 highest-paid Virginia CEOs of publicly traded companies at bottom of this story.)
Virginia’s most highly compensated CEO in 2021 was Michael J. Salvino of DXC Technology Co. in Ashburn, a Fortune 500 information technology services and consulting company. His pay totaled $28.716 million, a 32% jump over 2020, when he earned $21.733 million.
That compensation bump doesn’t necessarily correlate with the company’s financial performance, however. DXC posted $16.265 billion in 2022 revenue, down 8.26% from 2021, when it reported $17.729 billion. That, in turn, was 9.44% less than the $19.577 billion DXC reported in 2020. The company’s stock was trading at $26.60 in early September, down from a high of $96.75 per share in 2018.
DXC declined comment for this story. Salvino, who is also DXC’s chairman and president, has told investors that DXC has been going through a multiyear “transformation journey” to become better focused and more cost-effective. In earnings calls this year, the company said it missed some revenue goals after encountering unexpected costs and other disruptions associated with Russia’s invasion of Ukraine, which prompted DXC to withdraw business from Russia.
In August, the company posted first quarter 2023 earnings of $3.71 billion, down 10.5% from the same period a year ago. “Our transformation journey is creating value and we are confident that we are taking the right steps for DXC in the short term that will set us up for success in the long term,” Salvino said in a statement at the time.
Coming in second place for total compensation among Virginia CEOs of public companies was General Dynamics Corp. Chairman and CEO Phebe N. Novakovic, who received $23,553,862 in total compensation in 2021 for leading the Reston-based Fortune 500 global aerospace and defense contractor. That represented a 24% boost over her 2020 pay of $18.946 million.
General Dynamics reported $38.5 billion in 2021 revenue, up from $37.9 billion in 2020, but down from the $39.4 billion it reaped in 2019. The company’s stock hit a five-year high of $254.99 per share in March, when its General Dynamics Information Technology Inc. subsidiary won a $4.5 billion, 10-year National Geospatial-Intelligence Agency contract. General Dynamics stock was trading at $227.69 in early September.
In 2019, General Dynamics won the largest Navy contract ever awarded, a $22.2 billion multiyear order for nine Block V Virginia-class nuclear-powered, fast-attack submarines capable of launching Tomahawk missiles. That was followed by an additional $2.4 billion award in March 2021 to build a 10th Block V submarine. Construction of that submarine is expected to begin in 2024.
Coming in third place on the compensation scale was Christopher J. Nassetta, president and CEO of McLean-based international hospitality company Hilton Worldwide Holdings Inc. His overall compensation was $23.285 million, a 16% increase over his 2020 compensation of $20.058 million.
Like almost every other hospitality business, Hilton was hard hit by the COVID-19 pandemic and its business still hasn’t rebounded to pre-pandemic levels. For 2020 and 2021, it took in $4.307 billion and $5.788 billion in revenue respectively, well below the $9.452 billion it posted in 2019. But this summer, Nassetta said in an earnings call that, based on increased travel demand during the first half of this year, he predicted that business travel will be back “on a revenue basis equal to 2019 levels” by late 2022.
Nationally, the median pay for CEOs was $14.5 million in 2021 — a 17.1% increase from the $12.7 million media from the previous year, according to an analysis by Equilar and The Associated Press of compensation for CEOs leading S&P 500 companies for at least two years at the close of fiscal year 2021.
The highest paid U.S. CEO identified in the most recent Equilar/AP executive compensation survey was Peter Kern of Redmond, Washington-based online travel company Expedia Group Inc. Kern received $296.2 million in 2021. The only other S&P CEO to earn more than $200 million last year was David M. Zaslav of New York-based entertainment conglomerate Warner Bros. Discovery Inc., with a $246.6 million pay package.
Virginia CEOs — even the most highly compensated — are paupers by comparison.
Bonus babies
In Virginia’s CEO pay horse race for 2021, the biggest drop in salary was suffered by Timothy O’Shaughnessy of Arlington-based Graham Holdings Co., a diversified conglomerate that formerly owned The Washington Post and Newsweek magazine. His total compensation dropped 77% in 2021 to $2.252 million, down from $9.633 million in 2020. 
In terms of percentage gain in compensation, the biggest winner among Virginia CEOs was Michael J. Saylor of MicroStrategy Inc., a Tysons-based software firm best known as the world’s largest corporate holder of bitcoin. In 2021, Saylor saw his compensation go up 583% to $2.78 million, up from $407,160 in 2020.
But big winners don’t always stay that way.
In August, Saylor stepped down as MicroStrategy’s CEO, transitioning to executive chairman, amid an earnings report that tallied a $1.98 billion impairment loss on the company’s bitcoin holdings. Additionally, Washington, D.C.’s city government sued Saylor and MicroStrategy in August, alleging that Saylor and the company had engaged in a tax avoidance scheme, falsely claiming that Saylor was a resident of Virginia or Florida when his primary residence was in D.C. Saylor and MicroStrategy vigorously denied the allegations. (See related story.)
For the average Virginia CEO, Equilar’s study finds that bonuses are an important component of executive pay, accounting for about 20% of most CEO’s compensation packages. Overall, Virginia CEOs also saw increases in their 2021 bonus pay, which rose 35.9% over 2020, averaging $1.725 million in 2021, up from $1.373 million for the previous year.
Last year “was a good year, financially, for a lot of companies,” says Equilar’s director of research, Courtney Yu, explaining why bonuses and overall compensation rose significantly in 2021.
Novakovic of General Dynamics earned the biggest bonus among Virginia CEOs of publicly traded companies, reaping $6.074 million, an 111% bump over her 2020 bonus of $2.872 million.
The Virginia CEO who saw the largest percentage gain in their bonus pay last year was George Holm of Goochland County-based food distribution company Performance Food Group Co. His bonus pay rose 389% in 2021 to $1.8 million, up from $375,000 in 2020. Performance Food Group had furloughed or laid off thousands of workers and deferred 25% of its senior management’s compensation in 2020 as food orders from restaurants plummeted amid the early months of the pandemic. PFG reorganized its business segments this year to streamline operations.
Just behind Holm was Norfolk Southern Corp. CEO James A. Squires, who is on the list of Virginia CEOs for the last time this year after the railroad company formally finished moving its headquarters from Norfolk to Atlanta in late 2021. His bonus rose from $779,625 in 2020 to a far more robust $3.465 million in 2021, a percentage gain of 344%. His bonus significantly exceeded his base salary of $1 million.
Vested interest
But neither bonuses nor salaries are the biggest driver behind a CEO’s compensation, according to Yu of Equilar. Equity compensation, which can include shares, stock options or other ownership stake in a company, constitutes the largest portion of CEO compensation these days, which is a continuing trend, he says.
“Investors have always wanted [CEO] pay to be more closely aligned with performance, and when we measure performance, we’re talking about a company’s stock price usually,” Yu says.
The more equity executives are granted, the more their compensation is tied to the company’s stock performance, which is ultimately what investors care about, he says.
As a rule, CEOs can’t cash in on their equity immediately.
“There is a vesting component to it, usually three or four years,” Yu says, so equity grants function not only as an incentive for remaining in the job, but also for continuing to perform well over the long term.
The average equity award in 2021 was $5.5 million, more than twice the average $2.6 million that CEOs received from salaries and bonuses.
The largest equity awards made to a CEO in 2021 were to Salvino of DXC Technology. His equity awards totaled $25.087 million in 2021, constituting most of his $28.7 million compensation package.
Novakovic of General Dynamics, second on the compensation list, had equity awards totaling $15.395 million, making up more than 65% of her overall compensation of $23.5 million.
Christopher Nassetta of Hilton Worldwide Holdings received an equity award of $18.274 million against total compensation of $23.285 million.
Also notable in the Equilar survey is that women CEOs are sparsely represented among the top-paid Virginia CEOs, with only three women among the 56 Virginia CEOs whose compensation was studied. That’s just over 5% — considerably less than the 14.79% of women CEOs heading up Fortune 500 companies this year.
Besides Novakovic of General Dynamics, the other two top-paid women CEOS of publicly traded Fortune 500 Virginia companies are Nazzic S. Keene of Reston-based federal contractor Science Applications International Corp. (SAIC) and Kathy J. Warden of Falls Church-based aerospace and defense contractor Northrop Grumman Corp.
While few in number, Virginia’s women CEOs all had a high batting average when it came to compensation.
Novakovic bested all but one of the male CEOs and all of her female counterparts. Meanwhile, Warden with Northrop Grumman posted total compensation of $19.505 million in 2021, putting her among the top 10 highest-paid Virginia CEOs of public companies, despite seeing her compensation drop slightly from $19.662 million in 2020. And Keene with SAIC received compensation of $8.343 million, a 20% boost over her 2020 pay of $6.936 million.
The highest-paid U.S. woman CEO in 2021, according to Equilar, was Roz Brewer, who last year became CEO of Deerfield, Illinois-based Walgreens Boots Alliance Inc., which owns the Walgreens pharmacy retail chain. Brewer last year received $28.3 million in compensation — $20.2 million of which came from equity awards. 
Nancy Bagranoff, a professor of accounting and former dean of the University of Richmond’s Robins School of Business, says there are a lot of reasons why women aren’t becoming CEOs in the same numbers as men.
“But the main one is that we nominate and promote who we know. And, unfortunately, that means the same guys who meet on the golf course or in the locker room or in a bar or get-together,” says Bagranoff, who also was dean of Old Dominion University’s College of Business and Public Administration. “They don’t mean to exclude the women, but they don’t know them in the same way.”
Companies, she says, need more women at the top.
“It’s diversity and decision-making that leads to better performance,” Bagranoff says. “Having everybody the same … does not work. Women bring something different to the table, and having those differences are really important.”
Wealth gap
Overall, many Virginia CEOs saw their base salaries increase in 2021, although most rose by single-digit percentages.
There were exceptions, of course.
The executive who saw the biggest percentage increase in base salary was Hilton’s Nassetta, whose base salary increased by 259%, to $1.255 million in 2021, compared with $350,000 the year before, when Nassetta announced in April 2020 he would forgo his base salary for the rest of the year due to the economic impact of the pandemic.
Capital One Financial Corp. founder, Chairman and CEO Richard D. Fairbank earned no salary in 2021, but that’s in keeping with his long-term practice of being paid primarily in company stock. In 2021, Fairbank received an equity award of $15.817 million and a hefty $4.55 million bonus — the second largest bonus of any Virginia CEO. That’s up from the $3 million bonus he received in 2020 for heading up the McLean-based credit card and banking company.
The ratio of  CEO pay to the median pay of employees has been watched more closely in recent years, amid concerns about the widening wealth gap. (At the beginning of 2022, the top 1% of U.S. households controlled about 32% of the nation’s wealth, according to Federal Reserve data. Meanwhile, the bottom 50% of U.S. households collectively held 2.6% of the country’s wealth.)
Among the Virginia publicly traded companies with the highest paid top executives, median employee pay rose 0.8% from 2020 to 2021, while average CEO pay increased by about 5% during the same period, according to Equilar.
The CEO-employee pay ratio varies widely in Virginia. The lowest disparity between CEO pay and worker pay last year was at Freddie Mac (Federal Home Loan Mortgage Corp.), where the median worker pay was $154,483 and CEO Michael DeVito’s compensation totaled $443,032.
The highest CEO-worker pay gulf was at Richmond-based leaf tobacco supplier Universal Corp., where CEO George Freeman made $3.67 million last year, and the median worker pay was $1,928. (Universal’s workforce is largely composed of seasonal part-time laborers, many in developing countries.)
Yu of Equilar notes that the differences between CEO and employee compensation are inextricably tied to the types of industries being surveyed.
At retail companies, for example, Yu says, “you’re going to see lower median compensation, compared to those in the technology space.”
Nationally, CEOs of the 100 top-earning U.S. companies brought home 254 times more than the average worker in 2021, according to Equilar.  


In March 2021, General Dynamics was awarded a $2.4 billion contract option to build a 10th Virginia-class submarine in collaboration with Newport News Shipbuilding. Photo by Ashley Cowan/Newport News Shipbuilding
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