CEO or the Chief Executive Officer holds the highest ranking in any kind of company. To be able to hold this position is a very big thing, one has to be extremely responsible and hardworking because the entire company depends on them.
A CEO’s main responsibility includes expanding the business, doing finance-related works, and making all other important decision that is necessary for a company to flourish. All the major decision needs approval from the CEO, then only it can be established. A CEO also needs to coordinate with their employees with patience; this will result in a proper workflow.
People might think being a CEO of a company means earning a lot of money in terms of their salary but there is a trend that is emerging in the new world and some CEOs are following it ardently. It may sound unbelievable but there are some CEOs who take $1 for their salary. Yes, you read it right, just $1.
Some well-known CEOs are already a member of this trend. In this article, we will discuss, why some CEOs take just $1 as their salary and what are its benefits. So, let’s get started.
“Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.”
What does $1 Salary Mean?
One dollar salary is all about when some of the world’s top chief executives take just $1 in the name of salary from their company. Here, they decide to work without taking direct compensation but there is a rule where they have to take a minimal amount for the sake of some legal reasons, so to follow that, they just take $1. This way the CEOs are considered as volunteers by taking the minimal amount as their salary.
History of $1 Salary
This thing started in the early 1900s when the entire world was in a war-torn zone. During World War II, some of the top business leaders willing decided to offer their service for free to the Government. As there was a law, that doesn’t allow the President to accept free service from the businessmen, the concept of a One-dollar salary was born.
The year 1978 also saw Lee Iacocca, the CEO of Chrysler Corporation adopting this procedure to improve the state of his company after the oil crisis he asked the Government for their help.
In the 21st century, there are many wealthy CEOs who are following this ardently, but now the reason is not that they want to offer free services but because it is all about earning huge amounts of money smartly.
Perks of Taking $1 Dollar Salary
The fact of taking just $1 may seem very simple but in reality, it is far more compatible and this mode provides a lot of benefits to the CEOs than a regular salary can. Some of the benefits are:
- The biggest reason for the CEOs to obtain this trend is none other than taxes. CEOs take this little amount of salary so that they can avoid paying a hefty sum as tax to the Government.
- This improves the image of the CEO in front of the public and people start considering that person highly as it seems they are serving their country for almost free.
- It gives the investors confidence that the CEO will perform better to receive their compensation, thus leaving them no choice but to invest in the company. In the end, this results in getting investments.
How CEOs Live With Just $1 Salary?
It is not like the CEO only gets to have one dollar as their salary, apart from that they take compensation from the company in the form of stock or equity, as they are taxed at a much lower rate than regular income.
When the company performs well, the worth of the shares increase and the CEO's different forms of income also increases. All of these stocks, bonus packages that are offered to them apart from the one-dollar make up for their ‘sacrifice’ quite well and in fact sometimes even exceed their income.
Members of $1 Salary Club
Some of the most renowned CEOs who are the member of this club and ardently follow the trend are:
- Larry Page and Sergey Brin - founders of Google
- Mark Zuckerberg, co-founder of Meta and the CEO
- Elon Musk, CEO of SpaceX and Tesla
- Steve Jobs, Co-Founder of Apple
Being a CEO of a company comes with lots of perks but with also a lot of responsibilities. A CEO needs to take some of the most important decision of the business, there are some CEOs who take hefty sums and there are some who takes just $1 dollar but that doesn’t mean that they are providing their service for free, they are actually earning a lot by their smartness.
Why do CEOs make $1?
The CEOs can afford to earn $1 as they make money through other ways like through stocks and equity. This also helps them in avoiding taxes.
What is the minimum salary of a CEO?
An early career Chief Executive Officer (CEO) with 1-4 years of experience earns an average of ₹983,641.
Who are the CEOs in the $1 salary club?
Elon Musk, Mark Zuckerberg, Meg Whitman, Larry Page, and Sergey Brin are some of the CEOs that take $1 dollar as their salary.
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