FEI Study: No Salary Increases for 1/3 of Financial Executives

- Average Base Salary Increases Down over 2008, Amidst Expansion of
Responsibilities -

- Yet 94% Still Reported Bonuses -

FLORHAM PARK, N.J., April 29 /PRNewswire/ -- A growing number of financial
executives did not receive a salary increase, according to a new study by
Financial Executives Research Foundation (FERF), the research affiliate of
Financial Executives International (FEI). Financial executives in 2008 that
did receive a salary bump experienced a slight dip percentage-wise compared
with the average salary increase they received in the previous year, while the
breadth and depth of their responsibilities continues to expand. However,
nearly all of financial executives still reported a bonus in 2008.

The third annual Financial Executive Compensation Survey provides a
year-to-year comparison of compensation for finance professionals. The study
examines salaries, bonuses, long-term incentives and retirement benefits of
nearly 1,000 financial executives from both public and private companies, of
which half were CFOs. Completed solely by the financial executives
themselves, rather than human resources or executive search firm executives,
the survey results provide unique perspective.

"This year's results demonstrate that the combination of the economic downturn
and increasing pressure on executive compensation has left a clear impact on
U.S. financial professionals," said FEI CEO and President Marie Hollein.
"While salaries for this group still saw a boost, the percentage of their
increase declined from 2008. This, coupled with the fact that a sizeable
number of professionals did not receive increases at all this year, reveals
that the current crisis is undoubtedly reflected in the compensation of the
C-suite."

An indication of the changing role of the CFO and other finance professionals,
respondents to the survey revealed that their responsibilities have expanded
broadly in areas such as operations, administration, planning, and mergers and
acquisitions.

Salary & Bonuses
The estimated average base salary increase of all respondents is 3.7 percent
-- over a percentage point decrease from 2008's average of 4.96 percent.
However, nearly a third of respondents (31%) did not receive any salary
increase -- nearly double the amount (16%) who indicated no increase when
surveyed in early 2008.

An overwhelming 94 percent of survey respondents reported receiving a 2008
bonus. While bonus awards varied, nearly one fifth (18%) of financial
executives reported a bonus between 21-30 percent of their base salary, and
another 17 percent reported a bonus between 31-40 percent of their base
salary.

For the third year in a row, the base salaries of public and private company
CFOs remained proportionate to companies' annual revenues. Public companies
continued to award higher salary increases (4%) versus their private company
counterparts (3.4%).
-- For the 122 public company CFOs, the average annual compensation
reported is $410,100, of which $296,800 is the base salary,
representing
an increase from the prior year survey ($373,100). Bonuses for these
CFOs are based on a percentage of annual salary and ranged from 21-70
percent.

-- For the 344 private company CFOs, the average total compensation is
$257,800, of which $199,600 is base salary, representing a slight
decrease from the prior year ($262,800). Bonus percentages for these
CFOs ranged from 11-50 percent.

Beyond the Paycheck
"As the debate over salaries and cash-based bonuses continues to intensify,
companies will be examining other types of compensation benefits as a means to
award and retain professionals," said Cheryl de Mesa Graziano, Vice President,
Research and Operations for FERF. "Our survey results reveal this challenge
as decreases in retirement and long-term cash pay come with increases in
stock-based long-term awards. Also, though most companies are commonly using
company goals to evaluate performance, this year's survey surprisingly reveals
a decreased emphasis on individual goals, with more companies choosing EBITDA
as a form of measurement."

Key survey findings on areas of non-salary and bonus compensation include:

Retirement
-- While an overwhelming majority of respondents work for companies with
defined-contribution plans that provide an employer match, the number
of
respondents actually eligible to receive monthly benefits from their
company's defined benefit plan (19%) saw an overall decrease from
2008 (24%).
-- The overall number of supplemental retirement plans continues on a
three-year decline.

-- The number of executives that are not entitled to receive additional
monthly retirement benefits jumped to 84 percent.

Long-term incentives
-- Only 18 percent of respondents received cash-based long-term
incentives,
representing a continued decrease over the three years the survey has
been conducted.
-- On the contrary, 59 percent received some type of stock-based award.

-- Board/management discretion, title or position and salary grade level
are the primary criteria for determining if an individual is eligible
for long-term incentives.

Perks
-- The most common perk among respondents is the cell phone (76.4% of
financial executives receive);

-- The least popular perk continues to be, for the third year in a row,
housing or other living expenses (less than 1% of financial executives
receive).

Performance measures
-- For public company respondents, the most common performance measures
used to determine annual compensation continue to be company goals and
objectives (69.8% of public company respondents).

-- However, this year the decrease in individual goals and objectives as
a
performance measure (40% of public company respondents, compared with
74% in 2008) has been offset by an increase in the use of earnings
before interest, taxes, deprecation and amortization (EBITDA) (48%
compared with 16% in 2008).

Employment contracts

-- A majority (54%) of those surveyed still have employment contracts.
The
use of such contracts is identical to the prior year, with some type
of
severance pay as the most common provision (applies to at least 29% of
those who have employment contracts).

Detailed results of all responses are available online through Paycheck, FEI's
online search tool. Responses can be searched based on all criteria,
including: title, company industry, company type, company location, company
annual revenue, base salary, and annual bonus opportunity. PayCheck is
available on the FEI website www.financialexecutives.org. Non-members can
purchase the survey results for $129, by visiting the FERF bookstore online at
www.ferf.org/bookstore. (Results are free for all FEI members.)

About FEI and FERF
Financial Executives International is the leading advocate for the views of
corporate financial management. Its 15,000 members hold policy-making
positions as chief financial officers, treasurers and controllers. FEI
enhances member professional development through peer networking, career
management services, conferences, teleconferences and publications. Members
participate in the activities of 85 chapters, 74 in the U.S. and 11 in Canada.
Visit www.financialexecutives.org for more information.

Financial Executives Research Foundation (FERF) is the non-profit 501 (c)(3)
research affiliate of FEI. FERF researchers identify key financial issues and
develop impartial, timely research reports to FEI members and non-members
alike, in a variety of publication formats.

Media Contacts
Nicole Madison Lili DeVita
FD FEI
212-850-5647 / Nicole.Madison@fd.com 973-765-1021 /
ldevita@financialexecutives.org

Kristen Lewko
FD
212-850-5756 / Kristen.lewko@fd.com

SOURCE Financial Executives International

Nicole Madison, +1-212-850-5647, Nicole.Madison@fd.com, or Kristen Lewko,
+1-212-850-5756, Kristen.lewko@fd.com, both of FD for FEI; Lili DeVita, FEI,
+1-973-765-1021, ldevita@financialexecutives.org