Median CEO pay jumped 23.2% to $29.4 million in 2025 while the CEO-worker pay gap widened to 341:1, according to new data, raising new questions about fairness, AI-driven incentives and executive compensation.
CEO pay didn’t just rise in 2025, it accelerated sharply, reshaping the conversation about fairness, performance, and corporate values. Median compensation for CEOs at large U.S. companies climbed 23.2% to $29.4 million, the steepest increase in four years, according to new Equilar 100 data. The rise marks the largest year-over-year jump since the post-pandemic compensation surge of 2021, when CEO pay increased 30.8% amid widespread retention and recovery incentives.
At the same time, the gap between executives and workers widened again, with the CEO-to-employee pay ratio reaching 341:1, up from 300:1 a year earlier, a level likely to intensify scrutiny from investors, employees and regulators alike. The increase comes as boards place a premium on leaders capable of steering companies through economic uncertainty and the rapid transformation driven by artificial intelligence.
“The corporate world is currently navigating a period of transition and uncertainty, particularly amid the rapid rise of AI,” said Amit Batish, Senior Director of Content at Equilar. “In response, companies are increasingly relying on seasoned CEOs to lead through this shift. Many boards have also begun incorporating AI-related objectives into executive compensation plans to ensure leadership remains focused on these strategic priorities.”
TOP CEO COMPENSATION
At the top end of the pay scale, compensation reached unprecedented levels:
- Niraj Shah, CEO of Wayfair: $280.8 million
- Hock Tan, CEO of Broadcom: $205.3 million
- Peter Gassner, CEO of Veeva Systems: $172.4 million
- David Solomon, CEO of Goldman Sachs: $118.9 million
- Sridhar Ramaswamy, CEO of Snowflake: $101.3 million
In total, five CEOs crossed the $100 million mark, compared to just one in the prior year. These compensation packages were overwhelmingly driven by long-term stock awards tied to multi-year performance goals. Broadcom’s Hock Tan, for example, received performance stock units linked to ambitious AI revenue targets, underscoring how deeply AI strategy is influencing executive incentives.
The growing use of strategic and non-financial metrics in executive compensation has been accelerating for years, as reported. In fact, the number of S&P 500 companies linking climate and ESG metrics to executive pay more than doubled between 2021 and 2023.
STOCK AWARDS DRIVING COMPENSATION BOOM
The sharp rise in CEO pay was largely fuelled by equity compensation. According to the report, median stock awards climbed 38.8%, from $15.7 million to $21.9 million. In fact, equity now accounts for more than 70% of total CEO compensation
The structure reflects the modern “pay-for-performance” philosophy that has dominated executive compensation since post-financial-crisis reforms such as Dodd-Frank and Say on Pay rules. Still, critics argue the system can inflate compensation levels well beyond what most employees – and many stakeholders – view as reasonable.
Batish said boards remain primarily focused on tying compensation to performance outcomes rather than broader debates about inequality. “Ultimately, the key consideration is ensuring that executive pay is aligned with performance,” Batish said. “Stakeholders expect that high levels of CEO compensation correspond with strong financial results. Most pay packages are heavily weighted toward long-term equity awards, which vest over multiple years and are tied to rigorous performance targets.”
The broader shift toward ESG-linked incentives has been framed by many companies as an effort to align executive rewards with long-term value creation. Recent reports show that organisations are increasingly tying executive compensation to human capital, governance and sustainability outcomes.
WIDENING PAY GAP
The most contentious figure in the report may be the growing divide between executives and employees. The median CEO pay ratio among Equilar 100 companies rose to 341:1, up from 300:1 a year earlier. Median employee pay also increased, rising nearly 10% to $99,229, but failed to keep pace with executive compensation growth.
In short, for every dollar earned by the median worker, CEOs earned $341. The widening disparity comes as companies continue cost-cutting efforts, restructuring and automation initiatives tied to AI adoption.
Batish noted that, despite public attention on pay disparities, boards and investors have historically paid limited attention to the CEO pay ratio itself. “Since its implementation in 2018, the CEO pay ratio has rarely served as a meaningful input for investors or boards when making compensation decisions,” Batish said. “Both groups remain focused on aligning pay with financial performance, where the ratio plays little to no role.”
Still, he acknowledged that widening inequality can create reputational and workforce risks. “One potential risk is a disengaged or dissatisfied workforce,” Batish said. “A widening pay gap could contribute to employee resentment, although the extent to which this translates into long-term organizational impact remains unclear. More immediately, it tends to attract public scrutiny and criticism.”
RISING EXECUTIVE PERKS & SECURITY COSTS
Concerns over fair pay and workplace trust have become increasingly prominent in corporate governance discussions; particularly how equitable workplace practices are closely linked to employee engagement, belonging and retention, as reported.
Beyond salaries and stock awards, executive perks also climbed sharply. For example:
- Base salaries increased 5.3%
- Bonuses rose 17.2%
- Perquisites jumped 24.2%, reaching nearly $392,000
One major driver was executive security spending. Nearly 38% of S&P 500 companies disclosed executive security perks in 2025, up roughly 13 percentage points from the prior year, reflecting heightened concern over personal safety following the 2024 killing of UnitedHealthcare CEO Brian Thompson.
WOMEN CEOS REMAIN UNDERREPRESENTED & UNDERPAID
The report also highlighted the persistent gender imbalance in corporate leadership. Only five women appeared on the highest-paid CEO list, down from six the previous year. Median compensation for those women reached $27.7 million, with AMD CEO Lisa Su ranking as the highest-paid woman at $55.2 million.
Batish said the disparity reflects deeper structural issues in executive pipelines. “There is no question that women remain underrepresented in C-suite roles,” Batish said. “Since many CEOs come from P&L backgrounds, which have historically been male-dominated, the imbalance is likely to persist unless those pipelines diversify or alternative pathways to the CEO role become more common.”
The findings come amid wider concerns about stalled progress in leadership diversity, alongside board attempts to strengthen the connection between ESG priorities, diversity goals and executive incentives, as reported.
AI, EQUITY & NEW ECONOMICS OF LEADERSHIP
Corporate performance improved in 2025. Median company revenue rose to $25.7 billion, marking the first increase after three consecutive years of decline. Walmart remained the largest company by revenue at $681 billion, with Apple following at $416.2 billion
Yet stronger corporate performance has not muted criticism of rising executive pay. If anything, the debate has intensified as companies balance shareholder expectations with growing pressure to demonstrate fairness and social responsibility.
Taken together, the Equilar findings point to a broader shift in how corporate leadership is being valued in the AI era. Boards are increasingly awarding massive long-term equity packages to CEOs they believe can navigate technological disruption, investor pressure, and economic uncertainty simultaneously.
Several executives on this year’s list, including Broadcom’s Hock Tan, EA’s Andrew Wilson, Danaher’s Rainer Blair, and Halozyme Therapeutics’ Helen Torley, had compensation plans tied directly to AI-related growth or transformation goals.
At the same time, those equity-heavy structures are dramatically amplifying total compensation levels. Median stock awards rose nearly 39% in 2025 and now account for more than 70% of CEO pay, reinforcing a governance model built around long-term incentives and shareholder alignment following Dodd-Frank and Say on Pay reforms.
GROWING SCRUTINY OVER EXECUTIVE PAY
But as executive pay accelerates faster than worker wages, the system is facing growing scrutiny, not simply over how much CEOs earn, but over whether the rewards are proportionate, credible and broadly perceived as fair.
“Stakeholders expect that high levels of CEO compensation correspond with strong financial results,” Batish said. “These structures are designed to incentivise sustained performance, which remains the primary focus for investors and boards.”
Even so, the widening pay divide is increasingly colliding with rising expectations around corporate responsibility, workforce equity, and stakeholder capitalism, particularly as companies continue investing heavily in AI while simultaneously pursuing efficiency measures and restructuring across their workforces.
QUESTION OF FAIRNESS, NOT JUST PERFORMANCE
The 2025 data makes one thing increasingly clear: CEO pay is no longer just a governance issue, it’s a legitimacy issue. For companies that position themselves as purpose-driven or stakeholder-focused, the challenge is no longer simply explaining how CEOs are paid. It’s explaining why the system feels fair.
That question is becoming more urgent as executive compensation rises significantly faster than worker wages, particularly as companies accelerate AI-driven efficiency initiatives while simultaneously cutting jobs and restructuring workforces.
While boards continue to emphasise “pay-for-performance,” employees and stakeholders are increasingly evaluating whether performance – and prosperity – are being shared across the organisation. As previously highlighted, an increasing number of boards are reassessing how executive compensation aligns with ESG priorities, wellbeing and fair pay expectations.
HOW TO AVOID REGULATORY & REPUTATIONAL RISKS
Companies that fail to address widening compensation disparities face mounting risks:
- Erosion of employee trust and engagement
- Increased shareholder activism and regulatory scrutiny
- Reputational damage in an era of transparency
- Greater difficulty attracting and retaining talent
In a business environment where culture and credibility increasingly shape competitive advantage, compensation structures are no longer viewed as internal administrative decisions. They are public signals of what a company values.
To maintain trust and avoid growing reputational, cultural and regulatory risks, compensation experts say companies may need to rethink how value is distributed more broadly across the workforce. Among the approaches gaining traction organisations should consider:
Aligning pay growth across the organisation
Ensure executive compensation does not consistently outpace employee wage growth over time.
Tying rewards to broader performance metrics
Expand compensation frameworks beyond stock price and revenue targets to include innovation, employee retention, long-term resilience, and organizational health.
Using pay ratios as a strategic signal
Rather than treating CEO pay ratios solely as disclosure requirements, companies can use them as indicators of internal equity and workforce sentiment.
Expanding participation in value creation
Profit-sharing programs, broader equity grants, and workforce incentive structures can help ensure employees participate more meaningfully in company success.
THE BOTTOM LINE
In short, CEO pay in 2025 reflects a new era of corporate leadership – one defined by transformation, technology and rising expectations. But the companies that will lead the next decade are unlikely to be those that simply pay their CEOs the most. They will be the ones that can demonstrate that their systems of reward are fair, aligned with long-term performance, and capable of earning trust across the entire organisation.
Click here to view the full Equilar 100 ranking and compensation breakdown of the highest-paid CEOs in 2025.
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