It's Good to Be the CEO

Here's a surprise: A study commissioned by a group representing CEOs of some of the country's biggest companies has found that CEO pay isn't really out of control.

The response from corporate pay critics: Tell us another good one!

According to the report, which comes from compensation consultant Frederick Cook, the median pay of CEOs over the last 10 years has risen roughly in line with returns seen by shareholders of their companies. While big pay packages get lots of press, the median large- company CEO was paid about $6.8 million last year, which was actually about 3% less than the year before, according to the report.

Business Roundtable, a lobbying group that represents large-company CEOs, commissioned the study in response to some of the "misleading reports" in recent years about executive compensation, representatives of the organization said.

"Reports that large numbers of CEOs make hundreds of millions of dollars every year are simply untrue," said John Castellani, the Business Roundtable's president, in a statement. "Executive compensation has closely followed the growth that companies have experienced in the last 10 years."

Setting aside the obvious conflict of issue concerns, the Business Roundtable's report itself isn't exactly telling the whole story, according to critics of executive pay.

Not only does the report leave out scores of companies and some of the valuable perks that CEOs have been accumulating over the years, but the way it approaches the data it does report understates the true gains that executives have seen.

The report "might give readers the impression that the relationship of pay to firms' economic fundamentals [has] not changed significantly," said Lucian Bebchuk, a law professor at Harvard who focuses on corporate governance and executive compensation. "This impression would be completely incorrect."

The Roundtable's report is based on data from the Mercer 350, a group of 350 large-cap companies whose executive pay packages are tracked by Mercer Human Resource Consulting. Cook and the Roundtable decided to use the Mercer database because they wanted to focus on big companies, because their packages tend to get the most scrutiny, and because it has a good reputation, says Thomas Lehner, the Roundtable's director of public policy. The Wall Street Journal uses the Mercer 350 for its annual compensation survey, he notes.