CFO pay jumps 66% at major industrial spinoffs
A CAP study finds median one-time transaction awards for CFOs were $1 million, separate from recurring compensation and recruitment packages.
A recent study by Compensation Advisory Partners (CAP) has revealed that CFOs at newly independent companies, known as SpinCo, are seeing significant increases in their compensation packages. The median target total compensation for SpinCo CFOs has risen by roughly 66% when compared to their pre-transaction pay disclosures, while CEOs experienced a 57% increase.
CFO salaries rose by 11%, while annual long-term incentive opportunities saw a substantial jump of 102%. The study analyzed 19 major separations involving 29 resulting companies, with a median revenue of $11.8 billion for parent companies before the transaction and $5.2 billion for the resulting companies. The shift to top ranks of a standalone public company, as well as the expanded responsibilities, are key factors behind these compensation increases.
Additionally, external hiring patterns for CFOs have also shifted, with 58% of SpinCo CFOs being recruited externally, often from experienced public company CFOs.
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