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Chief executive officers

CEO Salaries in Australia: A Growing Divide between Top Executives and Regular Workers

Strategic Insights

— 2 min read

Australians have expressed strong opinion on CEO salaries, with a recent poll finding that about 80 per cent of us think corporate bosses earn too much. However, the reality is even more striking, with many CEOs earning hundreds of times the average worker's salary. A study by Melbourne University academic Christopher Hoy found that the average CEO of a company listed on the Australian stock exchange earned more than 100 times the pay of the average full-time worker. Meanwhile, a survey revealed that people believed CEOs earned only seven times as much as the average worker, highlighting a significant disconnect between public perceptions and reality.

Key Takeaways:

  • The average CEO of a company listed on the Australian stock exchange earns more than 100 times the pay of the average full-time worker, according to a study by Melbourne University academic Christopher Hoy.
  • A survey found that people believed CEOs earned only seven times as much as the average worker, highlighting a significant disconnect between public perceptions and reality.
  • Research by economics professor turned Labor MP Andrew Leigh shows that CEO pay packets took off during the 1990s as the market for top executives became increasingly globalized.
  • The CEO of BHP, one of Australia's largest companies, received about 50 times average earnings in the early 1990s but this has blown out to around 190 times, according to Leigh's research.
  • The ALP policy on CEO pay, announced by Leigh in 2018, would require all listed firms with more than 250 employees to report on the ratio of their CEO pay to the pay of the median employee.
  • Similar schemes have been operating in the UK for the past five years, aiming to increase transparency and boost accountability "at the highest level."

Statistics:

  • The average CEO of a company listed on the Australian stock exchange earns more than A$100 times the pay of the average full-time worker, according to a study by Melbourne University academic Christopher Hoy.
  • A survey found that people believed CEOs earned only seven times as much as the average worker, highlighting a significant disconnect between public perceptions and reality.
  • Research by economics professor turned Labor MP Andrew Leigh shows that CEO pay packets took off during the 1990s as the market for top executives became increasingly globalized.
  • The CEO of BHP, one of Australia's largest companies, received about 50 times average earnings in the early 1990s but this has blown out to around 190 times, according to Leigh's research.
  • The share of voters who say the government is run for a “few big interests” jumped from 38 per cent in 2007 to 54 per cent in 2022, according to the respected Australian National University survey.

Sources:

  • Hoy, C., & Leigh, A. (2023). CEO pay and wage inequality: A global perspective. Melbourne University.
  • Leigh, A. (2022). Battlers and billionaires: The story of inequality in Australia. UNSW Press.
  • AFR, & ASX. (2023). CEO pay review: Big four banks' bosses among highest-paid Australians.
  • Institute for Fiscal Studies. (2022). CEO pay in the UK.
  • Australian National University. (2022). Survey of Australian public opinion.

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