How Executive Pay Benchmarking Works
There's no legal formula for executive compensation, so companies often benchmark against revenue size and industry norms. This calculator combines a revenue-based percentage range with revenue-per-employee productivity to give you a realistic reference range.
Recommended Range by Revenue
| Annual Revenue | Recommended % |
|---|---|
| Under $1M | 12~18% |
| $1M~$3M | 8~12% |
| $3M~$10M | 5~8% |
| $10M~$50M | 3~5% |
| Over $50M | 1~3% |
If revenue per employee is $2M or more, the range is nudged up by 1 point; below $500K, it's nudged down by 1 point to reflect team productivity.
Frequently Asked Questions
Executive pay is often set as a percentage of annual revenue. Smaller companies tend to pay a higher percentage, while larger companies pay a lower percentage of revenue.
Higher revenue per employee suggests stronger productivity, which nudges the recommended pay range up slightly. Lower revenue per employee nudges it down.
No. It's an estimate based on common industry benchmarks. Actual executive compensation should be decided by a board or compensation committee.