CEO compensation at America’s largest companies continued its upward trajectory with a 7.5% median increase in 2025, despite emerging economic challenges and market volatility, according to new research.
A study of 320 S&P 500 companies by ISS-Corporate found chief executives earned a median of $16.8 million in total compensation, with more than two-thirds receiving pay increases during the most recent filing period.
“CEO pay disclosures at large U.S. companies broadly reflect the strong market performance of last year,” said Roy Saliba, managing director at ISS-Corporate. “However, recent market turbulence and ensuing uncertainty around tariffs, a global trade war, and a possible looming recession could raise concerns over significant CEO pay increases at companies that may be facing headwinds in the coming months.”
The 7.5% growth rate represents a slight moderation from the 9.2% increase observed between 2023 and 2024 filings.
Stock awards drive compensation growth
Consistent with previous years, the analysis revealed that stock-based compensation remained the primary driver of executive pay growth. While base salaries increased modestly at 2.7% to a median of $1.3 million, stock awards jumped 6.9% to $9.9 million. Option awards, when granted, rose 6.0% to $3.3 million.
Companies generally demonstrated strong shareholder returns during the measurement period, with median one-year total shareholder return (TSR) of 15.1% measured at fiscal year-end. Companies that increased CEO pay showed median returns of 16.8%, while those that reduced compensation still delivered median returns of 10.8%.
Industry variations reveal compensation patterns
Some sectors displayed notable disconnects between performance and pay. Transportation companies increased CEO compensation by 11.3% despite a 3.6% decline in median TSR. Conversely, banking executives saw a more modest 9.4% pay increase despite their sector’s impressive 33.5% median TSR.
The consumer durables and apparel sector led with the highest median CEO pay increase at 21.2%, followed by commercial and professional services at 16.9%. Food, beverage and tobacco was the only major sector showing a median decrease in CEO compensation, with pay falling 4.4%.
Automobile and components manufacturers struggled most with performance, recording a 23% median TSR decline, while CEO pay in the sector remained relatively flat with just a 1% median increase.
For the roughly 31% of CEOs who experienced compensation reductions, the median decrease was 7.2%.
The findings come at a time when executive compensation practices face increasing scrutiny from shareholders, regulators and the public amid economic uncertainty and persistent wage inequality concerns.
