Chief HR Officers Are Gaining Pay, Respect

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By Martin Berman-Gorvine

Nov. 17 — Chief human resources officers are increasingly paid like and given the same level of respect as other executives, consultants say.

“Anecdotally, where we see compensation headed for HR execs at larger companies is increasing exponentially for those HR execs that are strategic partners to the CEO—those HR executives that come to the table with proven data points to demonstrate the value that HR can bring to the business,” Amy Dufrane, CEO of the HR Certification Institute, told Bloomberg BNA in a Nov. 17 e-mail. “It is a fact that those execs see a higher salary than those HR professionals that are tactically focused.”

The top HR executives at S&P 500 companies were given median total compensation of $1.6 million in 2015, slightly down from $1.7 million in 2014, according to a report released Nov. 2 by Equilar, a provider of board intelligence solutions, and Allegis Partners, an international executive search firm.

“The CHRO is viewed as a peer and compensated as a peer to other C-suite members,” Mike Bergen, managing partner at New York City-based Allegis Partners, told Bloomberg BNA Nov. 17. They are being measured by the same standards and awarded compensation packages based on company performance, he said.

Certain industries like health care and technology, where change is especially rapid, will pay a premium to CHROs who are adept at managing it, he said. In those industries, total compensation for CHROs rose from $1.53 million to $2.311 million and from $1.712 million to $1.96 million from 2014 to 2015, the report said.

“In terms of skill set, we’re seeing a shift toward HR leaders bringing more general management skills,” such as developing an HR brand for the company and having “technology chops,” Bergen said.

“HR leaders used to be invited into the room only for executive compensation and succession planning discussions,” but company board members are now inviting them to stay the entire time, because “talent risk is so important,” he said.

To contact the reporter on this story: Martin Berman-Gorvine in Washington at mbermangorvine@bna.com

To contact the editor responsible for this story: Tony Harris at tharris@bna.com

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