Highest Paid CEOs End Up Being Fired Or Fined, Study Finds

Reuters


Ken Lay's Bank Fraud Trial Continues
Getty Former Enron chair Kenneth Lay

About 40 percent of the highest-paid CEOs in the United States over the past 20 years eventually ended up being fired, paying fraud-related fines or settlements, or accepting government bailout money, according to a study released Wednesday.

The report by the Institute for Policy Studies, a left-leaning think tank, said that chief executives for large companies received about 354 times as much pay as the average American worker in 2012. That gap has soared since 1993, when CEOs for big companies received about 195 times as much.

But the best-paying companies do not necessarily receive the best performance from their CEOs, the report said.

For example, Enron's Kenneth Lay was one of the 25 highest-paid chief executives for four years, before his company collapsed in an accounting fraud in 2001. In May 2006, a Houston federal jury found Lay guilty of fraud and conspiracy. His death two months later led to his conviction being thrown out.