Dive Brief:

• Median general counsel compensation last year was $3.2 million for women, $3 million for men, at the 500 largest companies that trade on the major U.S. stock exchanges, a survey by executive intelligence company Equilar finds.
• Driving the difference is an increase in pay since 2018 of 47% for women compared to 14% for men, the survey shows. Women are also in the GC seat more frequently now. They comprise about 36% of GCs at these companies, up from 27% five years ago.
• No reason is given for the gains but the report notes the increasing importance of social responsibility at large, high-profile companies. “The rise of influential social movements has placed substantial pressure on companies to set a more pronounced emphasis on issues of diversity, equity and inclusion (DEI),” the report says.

Dive Insight:

The size of the company makes a big difference in GC pay levels. Although all the companies represented are large, with at least $900 million in revenue, the median $5.3 million pay of GCs at the largest of them is almost five times the $1.2 million pay of GCs at the smaller companies. The largest companies are those that generate at least $25 billion in revenue. 

The industry matters a lot, too. GCs at companies in commercial services earn a median $5.3 million, about twice the $2.3 million earned by those in cyclical consumer goods. 

Most GC pay comes from performance incentives. That pay component, at a median $839,000, is roughly a third of what goes into the typical GC pay package. Salary is the next biggest piece, at roughly $600,000, followed by annual cash target, at $507,000, and stock awards, at $449,000. 

This pay mix isn’t consistent across the board. If the GC is in a technology company, for example, the stock piece is the biggest component, at almost 40%, while salary is only about 11%. At utilities, the mix is almost the complete opposite of that. The salary piece is about 27% while the stock piece is about 12%.

At financial services companies, half of the GC pay package comes from financial incentives. 

In a positive trend, the pay gap between GCs and CEOs is closing, albeit modestly, with CEOs making about 4.1 times that of GCs, down from 4.3 times five years ago. 

No reason is given for the narrowing gap, but it might be related to the changing mix of pressures companies face. 

“Legal and regulatory changes are driving higher levels of disclosure and compliance,” Kristin Campbell, former GC for Hilton Hotels, says in the report. That could increase companies’ reliance on their legal executive.  

“Some general counsel are being compensated for their contributions outside of legal,” John Gilmore, founding partner of executive search firm BarkerGilmore, says in an essay included in the report. These extra-legal responsibilities could include human resources, ESG, government relations, government affairs, corporate development, safety, security and compliance. 

“General counsel are one of the first members of the executive leadership team to take on additional responsibilities due to strategic abilities, business acumen and the close ties between legal and every other area of the company,” Gilmore says.