CBS Corp. Chief Executive Leslie Moonves once again pulled down one of the richest paychecks in corporate America — and the second-largest for the head of a media company — with a compensation package totaling $57.7 million in 2010.
The 61-year-old broadcasting chief was paid $3.5 million in base salary, a $27.5-million bonus and nearly $23 million in stock and option awards, according to a filing Friday with the Securities and Exchange Commission. The company also contributed nearly $900,000 to Moonves' pension fund and other compensation, including $2.5 million in reimbursement for taxes paid in New York.
In 2009, Moonves' pay package was valued at $43.2 million.
CBS justified the nearly 34% increase, saying that Moonves' leadership of CBS resulted in "extraordinary growth in shareholder value, and outpaced both the industry and the company's internal targets."
CBS' share price has nearly doubled during the last year, closing Friday at $24.34. The company's revenue climbed 8% in 2010, buoyed by the resurgence in television advertising. CBS owns the No.1 broadcast network as well as premium channel Showtime, television stations, radio stations and one of the largest billboard companies in the world.
"That's a lot of money," said Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware. "It's an entrepreneurial award for someone running an established business with little risk and an 8% revenue increase."
The company's advertising-supported businesses benefited from the stronger economy. Auto companies, which reduced spending in 2008 and 2009, bought more commercial time last year, and millions in political ads poured into local TV and radio stations as Republicans and Democrats battled for control of Congress and governorships.
But the resurgence in advertising revenue, for the most part, simply lifted the company back to where it was three years earlier. CBS' total revenue last year of $14 billion was largely unchanged from 2007 — the year before the recession pummeled the advertising market. Nor is the company as profitable: CBS' operating income for 2010 was $1.8 billion, whereas in 2007 it was $2.6 billion.
Fourteen months ago, Moonves signed a new five-year contract to manage CBS, an agreement that established his base salary and bonus targets. Moonves' bonus of $27.5 million surpassed his $12-million target.
The company's compensation committee agreed to give Moonves a $20-million payment "for the successes in his role as president and chief executive officer" and a "special cash payment of $7.5 million for his leadership in connection with the creation of premium content across the company's portfolio of businesses, particularly with respect to the CBS television network, which outperformed its media peers in 2010," the company's filing said.
Elson said directors should take into account the company's investors when calculating executive pay.
"The quintessential question is this: Is the board of directors adequately representing the interests of the company's shareholders?," Elson asked. "If the answer is yes, then you can justify that amount. If the answer is no, then that salary is too high."
CBS Chairman Sumner Redstone also was handsomely rewarded. He received a package valued at $20.3 million. The 87-year-old Redstone also received $15 million in awards for his role as chairman of sister company Viacom Inc. From the two companies, Redstone's total compensation for 2010 was $35 million.
So far, Viacom's chief executive, Philippe Dauman, has received one of the most lucrative packages in the country for 2010 and the highest for a media executive: $84.5 million. That included a signing bonus that is currently valued at $31.65 million.