Second in total compensation was Albert L. Lord, chief executive and vice chairman of SLM Corp., with $41.8 million, of which $33.2 million was the estimated value of stock options. Lord led the list in 2002. Like Fannie Mae, SLM, also known as Sallie Mae, is chartered by the government. The company, which services, collects and invests in federally insured student loans, has been in the process of diversifying and privatizing itself. The stock returned 10.5 percent last year.
Lord was followed by mobile phone company Nextel Communications Inc. chief executive Timothy M. Donahue with $29.4 million (total return 142.9 percent), SLM Chief Operating Officer Thomas J. Fitzpatrick with $27.8 million and Gannett Co. chairman and chief executive Douglas H. McCorkindale with $26.2 million (total return 25.8 percent.)
Pay for XM Executives Modest as Stock Recovered (The Washington Post, Aug 16, 2004)
Lucrative Cash Package Came as Fairchild Reported $53.2 Million Loss (The Washington Post, Aug 16, 2004)
Board Members, Executives and Family Members Can Still Benefit (The Washington Post, Aug 16, 2004)
Expense Issue Draws Mixed Views From Companies (The Washington Post, Aug 16, 2004)
Survey Estimates Values of Options, Excludes Exercises (The Washington Post, Aug 16, 2004)
Top Compensation Packages
Transcript: Washington Post staff writer David Hilzenrath and editor Mike Flagg were online to discuss the 2004 executive compensation survey.
Audio: Washington Post reporter David Hilzenrath discussed executive compensation on WTOP.
The ranks of the highest paid remained overwhelmingly male last year. Only two of the top 100 were women, Catherine G. West, president of the U.S. card unit of credit card company Capital One Financial Corp., and Marianne M. Keler, executive vice president of SLM.
Along with salary, bonuses, stock, and options, executives were rewarded with a variety of perquisites. Some were also reimbursed for the taxes they owed on those perks. And some were paid to hire personal financial advisers to help them manage their millions, including their personal income taxes.
For example, Culp's pay included $136,529 for Danaher's partial forgiveness of an interest-free $500,000 loan and $100,378 to reimburse Culp for taxes he owed on that forgiven debt.
McCorkindale of Gannett, the nation's largest newspaper chain, received $38,000 for legal services, and $33,239 of reimbursement for taxes on perquisites. Fannie Mae's Raines received $37,548 for tax counseling and financial planning services. He also was granted "personal use of company transportation" worth $196,852, the company reported. That included use of jets chartered by the company.
Some of the area's largest public companies didn't have any executives on the list of the 100 most highly compensated by total compensation. Those included cement-maker LaFarge North America Inc., management consultant BearingPoint Inc., The Washington Post Co., electric utility Pepco Holdings Inc. and gas utility WGL Holdings Inc.
Several companies had five or more executives among the top 100, including Nextel, Fannie Mae, Gannett, defense contractor Lockheed Martin Corp., biotech company Medimmune Inc., hotelier Marriott International Inc., FBR and stereo-maker Harman International Industries Inc.
Nationally, there has been a shift away from stock options and the "mega grants" that gained notoriety during the last bull market and the corporate scandals that followed, said Charles A. Peck, a compensation specialist at the Conference Board, a research group funded primarily by businesses. Partly because stock options came to be seen as encouraging earnings manipulation, firms have been giving greater emphasis to bonuses, restricted stock awards and long-term incentive plans that typically pay in stock, he said.
Ira T. Kay of Watson Wyatt & Co., a compensation consultant to corporations, said he observed a big decline in the value and number of stock options granted during 2003.
But options still seem to flourish among the top 100 local executives. Eleven executives at seven companies received option grants last year estimated to be worth more than $10 million, and 125 received grants worth more than $1 million.
In 2003, as in 2002, options accounted for just over half of the median estimated total compensation.