Arnaldo Ulaj is a Partner at Clearbridge Compensation Group with nearly fifteen years of experience advising boards of directors and senior management on executive compensation and governance-related matters.
Natalie Smyth
Principal
Natalie Smyth
Principal
Natalie Smyth is a Principal at ClearBridge Compensation Group with ten years of experience advising on all aspects of executive compensation including pay levels, performance measurement, and incentive plan design.
CLEARthinking: Industry Matters: Comparison of CFO Pay
Executive Summary
CFOs play a critical role in managing risk and the financial health of their company. As companies navigate technological advancements, globalization, increased competition, and evolving macroeconomic conditions, the CFO role has expanded to take on broader strategic responsibilities.
With the increase in the scope and complexity of the CFO role, pay practices have also evolved. Differences in CFO pay practices are often shaped by sector-specific factors, such as the complexity of financial operations, exposure to regulatory scrutiny, pace of innovation, and capital intensity. The competitive landscape for finance talent also varies by industry, further influencing pay levels/design.
In this CLEARthinking, we examine how CFO compensation compares across sectors, analyzing target CFO pay levels, pay mix, and recent growth trends among 600+ mid-cap companies across 10 sectors.
Item
Key Takeaways
Target Total Direct Comp (“TDC”)
Median CFO TDC ranges by sector from $1.6M to $4.0M
Information Technology leads in TDC ($4.0M at median) while Utilities has the lowest TDC ($1.6M at median)
Compensation Elements & Mix
Salaries typically range from ~$500k to ~$700k, and target bonuses typically range from ~70% to ~100% of salary
Long-term incentives (“LTI”) vary by sector (39% to 74% of TDC at median)
Average pay mix is 42% cash and 58% LTI, with significant variation by sector
The highest paying sectors provide over 60% of TDC in LTI (i.e., Information Technology, Communication Services, Healthcare, and Energy)
Incumbent Annual Compensation Growth
Annual TDC for incumbents increased by 10% per year at the median
Consumer Discretionary had the highest median increase (13% per year), and Materials had the lowest increase (8% per year)
All sectors are continuing to increase their emphasis on LTI, with median LTI growth (13%) outpacing median target cash compensation growth (6%)
Turnover
15% of mid-cap companies disclosed a new CFO, with Utilities having the highest turnover rate (26%), and Real Estate having the lowest (2%)
The lowest paid sectors had the highest turnover rates (Utilities 26%; Consumer Discretionary 22%)
At median, incoming CFOs were paid at the ~40th percentile, recognizing that actual pay depends on whether it is the candidate's first time in the CFO role, the candidate’s level of experience, and specific company needs
Target Total Direct Compensation
In comparing CFO pay across sectors, we analyzed target TDC for companies with market caps between $2B and $10B. Provided below is a summary of median TDC by sector, with additional detail provided in the Appendix.
Information Technology CFOs are paid more than 2x Utilities CFOs, with the majority of the difference attributable to at-risk equity compensation.
Compensation Elements & Mix
On average, mid-cap CFOs have a pay mix of 42% target cash compensation (salary + target bonus) and 58% target LTI, with significant variation by sector.
The highest paying sectors provide over 60% of TDC in LTI on average (i.e., Information Technology, Communication Services, Healthcare, and Energy).
Incumbent Annual Compensation Growth
All sectors are increasing emphasis on LTI, with incumbent CFO annual LTI increasing ~10% to 20% per year vs. ~5% to 10% for target cash comp, resulting in TDC increasing ~8% to 13% per year (based on annualized growth data over two recent fiscal years).
Overall, mid-cap CFO pay increased by 10% at median, with Consumer Discretionary, Consumer Staples, and Information Technology seeing the biggest increase for incumbents.
Turnover Rates
15% of mid-cap companies disclosed a new CFO, with Utilities having the highest turnover rate (26%), and Real Estate having the lowest (2%).
Sectors with the lowest paid CFOs had the highest turnover rates (Utilities 26% and Consumer Discretionary 22%).
Appendix: Additional Detail
Provided below for reference are the summary statistics for company size and CFO compensation data for each of the sectors included in our analysis. Note that data reflects target annual compensation, with special, one-time awards included on an annualized basis.
Sector
%ile
Size ($BB)
Target Compensation* ($000s)
Average Pay Mix
Revenue
Market Cap
Salary
Bonus (% Sal.)
TCC
LTI
TDC
Cash
Equity
Total Sample (n=623)
75th
$4.7
$5.8
$676
100%
$1,305
$2,741
$4,073
42%
58%
50th
$2.2
$4.1
$583
80%
$1,068
$1,688
$2,876
--
--
25th
$0.9
$2.9
$504
70%
$854
$947
$2,046
--
--
Communication Services (n=16)
75th
$4.3
$5.6
$849
100%
$1,750
$3,307
$4,710
39%
61%
50th
$3.0
$4.6
$676
100%
$1,353
$2,453
$3,624
--
--
25th
$1.5
$2.9
$525
88%
$1,046
$1,654
$2,983
--
--
Consumer Discretionary (n=103)
75th
$8.0
$8.6
$878
100%
$1,801
$4,159
$6,283
61%
39%
50th
$4.0
$4.6
$716
100%
$1,406
$1,684
$2,281
--
--
25th
$2.1
$3.1
$583
75%
$1,101
$548
$1,742
--
--
Consumer Staples (n=28)
75th
$6.3
$6.3
$741
85%
$1,345
$1,806
$2,753
49%
51%
50th
$3.2
$3.8
$572
75%
$1,015
$1,207
$2,372
--
--
25th
$2.8
$2.5
$505
65%
$838
$905
$1,654
--
--
Energy (n=36)
75th
$4.5
$5.4
$637
100%
$1,275
$2,813
$4,061
36%
64%
50th
$3.2
$4.0
$577
100%
$1,153
$2,269
$3,470
--
--
25th
$2.1
$3.1
$462
90%
$875
$1,158
$2,049
--
--
Healthcare (n=92)
75th
$2.0
$5.2
$610
80%
$1,100
$3,437
$4,421
31%
69%
50th
$0.8
$3.8
$557
60%
$892
$2,002
$2,949
--
--
25th
$0.3
$2.7
$460
45%
$760
$1,733
$2,360
--
--
Industrials (n=129)
75th
$5.9
$5.9
$663
100%
$1,310
$2,404
$3,746
43%
57%
50th
$3.1
$3.8
$600
85%
$1,114
$1,962
$2,941
--
--
25th
$1.9
$3.1
$541
70%
$942
$1,001
$1,999
--
--
Information Technology (n=103)
75th
$2.2
$5.7
$583
90%
$1,093
$5,239
$6,904
26%
74%
50th
$1.0
$3.0
$495
90%
$907
$2,693
$3,665
--
--
25th
$0.6
$2.7
$451
70%
$765
$1,882
$2,936
--
--
Materials (n=44)
75th
$7.0
$7.9
$790
90%
$1,362
$3,974
$5,430
45%
55%
50th
$3.8
$3.8
$650
80%
$1,204
$1,384
$2,668
--
--
25th
$2.4
$3.0
$575
75%
$991
$1,081
$2,058
--
--
Real Estate (n=45)
75th
$6.2
$7.2
$637
115%
$1,376
$2,018
$3,923
45%
55%
50th
$3.7
$3.7
$557
100%
$1,133
$1,379
$2,462
--
--
25th
$2.1
$2.4
$500
70%
$850
$1,063
$1,856
--
--
Utilities (n=27)
75th
$3.1
$5.2
$600
70%
$968
$1,361
$2,261
52%
48%
50th
$1.9
$3.4
$520
68%
$830
$738
$1,612
--
--
25th
$1.3
$3.3
$452
58%
$689
$515
$1,239
--
--
*For comparison purposes, data is updated by an annual factor of 3% to 2025.
April 30, 2025
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CLEARthinking: Industry Matters: Comparison of CFO Pay
