Most of the chief executive officers for publicly traded companies based in the Richmond region got pay raises in 2017, but none of them earned enough to rank among the nation’s 100 best-paid corporate chiefs last year.

Median total compensation rose 34 percent to $3.61 million in 2017 for CEOs of 20 companies with headquarters in the region whose shares trade publicly.

The median pay was up from $2.69 million in 2016, according to data compiled by Equilar, an executive compensation and corporate governance data research firm.

Out of the 21 CEOs whose total compensation packages were included in the research, 14 saw increases in 2017, ranging from 1 percent to 934 percent. Four saw their total compensation decline in 2017 between 1 percent and 50 percent. Pay comparisons were not available for three CEOs because they had not been in the job long enough.

The median pay is the midpoint number — half of the CEOs made more and half made less.

While median pay for local CEOs was up, the average compensation declined 4 percent in 2017 to $5.39 million, from $5.55 million in 2016.

Most CEOs earn bigger payouts through performance-based compensation plans, so the growing economy certainly factored into the general increase in pay, said Tom Arnold, a professor of finance at the University of Richmond’s Robins School of Business.

“Given that the economy has been doing fairly well — trade wars aside — the incentive pay reflects that,” he said. “The economy does well, the company does well, and that is where incentive pay kicks in.”

The 34 percent jump in median compensation means pay increased at a faster pace for Richmond-area CEOs compared with the 8.5 percent median pay raise for CEOs of S&P 500 companies. However, the median pay package was higher for S&P 500 CEOs, at $11.7 million.

Equilar’s numbers for CEO compensation are typically different from what the companies report to shareholders because Equilar excludes changes in pension plan value and above market earnings on deferred compensation.

The highest-paid local CEO in 2017 was Dominion Energy’s Thomas F. Farrell. As chairman, president and CEO of the state’s largest utility company, Farrell earned $14.21 million, up 18 percent from $12.09 million in 2016.

That put Farrell at No. 186 among the nation’s top 200 best-paid CEOs for 2017, according to an Equilar ranking.

Compensation for other local CEOs ranged from $415,942 for John D. Gottwald, CEO of Chesterfield County-based manufacturer Tredegar Corp., to $11.99 million for Martin J. Barrington, who retired in May as chairman and CEO of Henrico County-based Altria Group Inc., parent company of tobacco giant Philip Morris USA.

The median household income in the Richmond metro area was about $61,000 in 2016, the latest year for which data is available, according to the U.S. Census Bureau.


Most of the pay increases for local CEOs from 2016 to 2017 came from what companies call “non-equity incentive plan compensation,” or NEIP, a type of pay often determined by complex, pre-established formulas set by a company’s board of directors and aimed at rewarding executives for achieving certain financial or operational goals.

“Most companies these days use NEIP rather than bonuses, because the process for determining the payout is transparent to shareholders,” said Charlie Pontrelli, a research analyst at Equilar.

For instance, nearly all of Farrell’s 18 percent pay increase from 2016 to 2017 at Dominion Energy came from non-equity incentive pay, except for a 3 percent salary increase, which a company spokesman said was the average salary increase for all employees.

Farrell made almost $1.55 million in salary, but the largest part of his compensation — and the largest bump from 2016 — was the $7.24 million he made from NEIP.

“When it comes to the non-equity incentive compensation plan — that rewards performance, and in 2017 our company had a very good year,” said Ryan Frazier, a corporate spokesman for Dominion Energy.

Among the reasons that the company’s board of directors cited for the pay increase were: The completion or progress on several large-scale infrastructure projects; an 8.4 percent increase in the company’s dividend; an all-time best safety record in 2017, and a net capacity factor of 95 percent at the company’s nuclear power plants.

Barrington, Altria Group’s former CEO, saw the largest percentage drop in compensation — a 50 percent decline from $24.2 million in 2016 to $11.99 million in 2017. His pay package last year still was enough to make him the second highest-paid among local CEOs.

Most of the change was due to a drop in non-equity incentive pay. The company’s long-term incentive pay to executives is structured in three-year cycles, and last year was only the first year of a cycle.

Barrington’s base salary actually increased to $1.47 million in 2017 from $1.41 million in 2016, and the value of his stock awards was essentially unchanged at about $6.5 million.

The value of his non-equity incentive pay was down from almost $16 million in 2016 to about $3.7 million in 2017. Barrington retired in May of this year.

The largest percentage jump in compensation from 2016 to 2017 went to a CEO who did not live in the Richmond area, though his company, Straight Path Communications, was legally based here with a small office in western Henrico County.

Davidi Jonas, CEO of Straight Path, saw a 934 percent increase in pay to $6.44 million in 2017, with all of the increase coming from stock awards. Straight Path, which held spectrum licenses that could be used for faster 5G service, was acquired by telecommunications giant Verizon Communications Inc. in late February for about $3.1 billion after a bidding war.

The next largest percentage increase in compensation went to the two co-CEOs of Henrico County-based specialty insurer Markel Corp. Thomas S. Gayner and Richard R. Whitt saw their compensation increase by 39 percent and 38 percent respectively, to about $3.26 million.

None of the Richmond-area CEOs came close in 2017 to earning the $21.2 million pay package that went to Phebe N. Novakovic, CEO of defense contractor General Dynamics, who was the top-paid CEO of a public company in Virginia last year.

It is too early to tell how the burgeoning trade war between the U.S. and a host of other nations will impact the economy and corporate results, Arnold said. If the impact is significant, it could hurt pay packages for some CEOs next year.

“Some of these firms do have a multinational component to them,” he said. “That could affect performance and consequently the performance-based pay.

About 24 percent of the median pay for Richmond-area CEOs was base salary, compared with 12 percent for S&P 500 companies.

“It looks like the Richmond companies are more cash-heavy” in compensating CEOs when compared to S&P 500 companies, Pontrelli said.


For the first time this year, most U.S. public companies were required to disclose their CEO pay ratio — a comparison of the annual total compensation of the CEO to the annual median pay for other employees.

For instance, a CEO pay ratio of 10-to-1 would mean the CEO makes 10 times as much money in one year as an employee who earns the median pay rate for that company.

Not all of the Richmond-area companies have had to disclose their CEO pay ratio, yet. For those that did, the ratios varied widely, from about 12-to-1 for Tredegar and Dynex Capital, to 228-to-1 for The Brink’s Co.

Dominion Energy reported a CEO pay ratio of 109-to-1. Altria’s was 114-to-1, while Goochland County-based automotive retailer CarMax Inc. had a ratio of 214-to-1. Hanover County-based Owens & Minor Inc., a distributor of medical supplies, reported a ratio of 169-to-1.

The ratios were lower at smaller companies such as Dynex and Tredegar. NewMarket Corp., a Richmond-based maker of petroleum additives, reported a ratio of 24-to-1.

Some experts have questioned the value of the CEO pay ratio.

“I would say it isn’t very useful because of the inconsistent methodologies used across companies” to calculate median pay for employees, Pontrelli said. “Also, the nature of the company’s employees can have a huge impact.”

For instance, The Brink’s Co., a Henrico-based company that provides logistics, cash management and secure transportation services, reported a CEO pay ratio of 228-to-1 for its U.S. operations.

However, the company has employees in 47 countries, so when its international operations were factored in, the pay ratio was 662-to-1, because the median pay for international employees — many of whom are seasonal or part-time — was far lower than for U.S. employees.

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(10) comments


Median household of $61,000 is about 20% of what would amount to 'middle income'.


If only all employees pay was based on merit or accomplishment.


Thank you, Mr. Boston, for being evidence of some diversity. I look forward to the day when I see fewer white men and more women and people of colour in these lists.


Agree with Olivia. Would also like to see how these salaries compare to those of our teachers, in my opinion the most important profession of all!

RJ Mathews

Agreed. There are more Gottwalds on the list than women and minorities combined.

James McIntyre

Maybe the Gottwald's got what they deserved the hard way . . . They WORKED for it !


:) And he's a really nice guy with a great story. Keeps a low profile, but I can't blame him. Really nice man. Representation matters.


CEO's pay is based on merit, not skin color or sex.


Merit, really? Surely others could do as well. I'd guess it's the knowledge only the CEO holds, and the value of containing that knowledge. Similar to the reason top athletes are paid fortunes, hush money.

James McIntyre

Amen , Everybody thinks that someone owes them something because of their Skin color and/or sex . How about working hard for what you get ! . . .forget the skin color and sex ! Success is NOT based on a quota system ! ( Thank God )

Welcome to the discussion.

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