Compliance officers interested in seeing how their annual salaries stack up against their peers will want to have a look at a newly released benchmark report that provides a telling picture of some of the most prominent compliance salary trends today.
The “2019 Compliance Compensation Report,” published by executive search firm BarkerGilmore, provides guidance, trend analysis, and benchmark data for compliance officers looking to expand their roles or leverage their experience for new positions. “It also serves as a tool for hiring managers and human resources departments seeking to build their organization’s compliance department and retain top talent in the industry,” the report states.
Among the over 800 individuals who responded to the survey, 53 percent were chief compliance officers; 33 percent were managing compliance officers (those with at least one direct report, who is not the lead compliance officer); and 14 percent were individual contributors (those who don’t have any direct reports and may hold a compliance director, manager, or analyst title).
Salary trends by industry
The median annual salary increase rate for all positions across industries is 4.1 percent, down 0.1 percent from the previous year, with the consumer sector experiencing the highest median increase rate of 4.8 percent from 2017 to 2018. The industrial and manufacturing sector experienced the lowest increase rate at 3.7 percent, “which is particularly interesting because this sector reported some of the highest increase rates in 2017,” the report noted.
Among public companies, chief compliance officers in the healthcare and life-sciences industry received the highest total compensation: $507,000 in the public sector and $332,000 in the private sector. Total compensation is defined as the sum of the current base salary, most recent cash bonus, and estimated long-term incentive value in U.S. dollars for the 2018 fiscal year.
Following the healthcare and life-sciences industry, chief compliance officers in the industrial and manufacturing industry received the second highest total compensation: $445,000 in the public sector and $327,500 in the private sector.
Among managing compliance officers in the public sector, the highest total compensation ($383,000) was in technology, followed by healthcare and life sciences ($310,000). In the private sector, managing compliance officers in finance received the highest total compensation ($300,000), followed by the consumer industry ($296,618).
Among individual contributors of compliance in the public sector, technology again showed the highest total compensation ($224,333), as well as in the private sector ($186,000). Following technology, chief compliance officers in the industrial and manufacturing industry received the second highest total compensation in both the public sector ($192,000) and the private sector ($164,000).
Public vs. private
Among all position levels, a statistically significant difference exists between the compensation of those at publicly traded companies and those at private companies. “At the chief compliance officer level, this disparity is much less noticeable for CCOs who hold law degrees than for those without law degrees,” the report states.
For example, chief compliance officers who hold law degrees have an average base salary of $290,000 at public companies and an average base salary of $307,672 at private companies, among companies with at least $5 billion in annual revenue. In comparison, chief compliance officers without law degrees show an average base salary of $222,500 at public companies and an average base salary of $181,000 at private companies.
The size of the gap between public- and private-company compliance officers is especially noticeable through the long-term incentive (LTI) compensation component. “LTI is much higher for public company compliance officers and non-existent for most private company compliance officers,” according to the report.
Chief compliance officers who hold law degrees earn significantly more than those without law degrees. Total compensation for those who hold a law degree is $407,832; advanced degree (i.e. Masters, PhD), $275,000; undergraduate degree, $200,000; and a high school diploma, $156,278.
The same is true among managing compliance officers. Total compensation for managing compliance officers who hold a law degree is $296,033; advanced degree (i.e. Masters, PhD), $205,000; undergraduate degree, $231,000; and a high school diploma, $182,000.
The data showed that total compensation for individual contributors who hold a law degree is $172,000; advanced degree (i.e. Masters, PhD), $137,000; undergraduate degree, $135,250; and a high school diploma, $104,600.
Who’s on the market
According to the report, 40 percent of respondents (a 4 percent jump from the previous year) said they’ll consider a new position within the next year due to compensation issues. Although compliance officers in the consumer industry expressed more satisfaction in comparison to peers, they also report the greatest likelihood of a job search in the next year (51 percent expressing a high or very high probability). Those in the technology industry are least likely to engage in a job search (74 percent with low or very low probability). Overall, most compliance officers indicated they are satisfied with compensation in their current roles.
BarkerGilmore’s “2019 Compliance Compensation Report” can be read and compared to its “General Counsel Compensation Report.”
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