October 2, 2020

Wall Street Journal: Shale Companies Had Lousy Returns. Their CEOs Got Paid Anyway

by Collin Eaton

It’s been a bad few years for investors in shale companies, but a pretty good few years for shale company CEOs.

The leaders of U.S. shale companies received some of the largest executive pay increases in corporate America, even as their shareholders lost billions of dollars, a Wall Street Journal analysis has found.

In response to inquiries from the Journal, some companies said their CEOs had also suffered due to the decline in the valuations of their companies, noting that the bulk of their compensation came from long-term stock incentives.

Total pay reported by companies includes salaries, cash bonuses and stock awards that may not vest for years, and will ultimately be less if the stock declines. Indeed, the value of beneficially owned shares held by CEOs of the 19 U.S. oil companies fell by a median of about 53% from the start of 2020 to Sept. 27, according to compensation consultant Farient Advisors LLC.

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