Defined benefit pension values dragged down CEO compensation among the nation’s largest corporations last year.

Total compensation disclosed in company proxy statements for chief executive officers  at the nation’s largest corporations remained relatively unchanged in 2013, primarily the result of sharply lower pension values, finds a new analysis of proxies by Towers Watson

Total pay for S&P 1500 CEOs increased less than 1% (0.5%) in 2013, down from the 5.7% median increase CEOs received in 2012.

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Robert Newbury, director of executive compensation resources for Towers Watson, says that an analysis of Securities and Exchange Commission proxy statements highlights that the change in pension values is “really impacting pay overall this year.”

“The rising interest rates caused a lot of companies to move downward relative to the values they were reporting in earlier years,” Newbury tells EBN. “So when we’re looking at year-over-year changes, we’re seeing significant drops impacting the total value of pay.” Stock-based awards, annual bonuses and long-term incentives were listed as the most common CEO compensation structures.

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“I think what we’re really starting to see is that companies aren’t factoring in performance as much as they had in the past when they set pay,” Newbury explains. “By setting pay, they are not making, for instance, big adjustments on salary and bonus just [based] on performance. What they are saying [to CEOs] is: ‘Your target level of pay will be flat year-over-year, and any increase value you receive from your pay package will be the result of bonus payouts and how the stock performs.’”

Despite the troubles experienced by larger firms, many smaller companies on the S&P 1500 were able to regain ground, with smaller companies reporting a 2.5% increase in CEO pay last year. The fact that only 22% of small firms still have a DB program might be part of the reason for the discrepancy, Newbury notes.

“For the smaller companies, many of them didn’t have a pension program to begin with; they are structured around 401(k)s [instead],” Newbury says.

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