Total median pay for chief executive officers at the largest US corporations rose in 2022 but the pace of growth slowed from the previous year, according to a report by WTW. The report found that total pay for CEOs increased 2.7% in 2022, down from the 18.3% median increase in 2021, primarily driven by a decrease in annual bonuses and slower growth in long-term incentives.

“CEO pay stabilized last year and is returning to levels typically seen before the pandemic,” said Don Delves, North America leader of executive compensation at WTW. “Given the stock market performance and lingering economic uncertainties, the fact that annual and long-term incentives weakened last year demonstrates the pay-for-performance model is working at most companies.”

Total pay includes base salary, actual annual and long-term cash bonuses, the grant-date value of long-term incentives such as stock options, restricted stock and long-term performance shares, the value of perquisites, earnings from deferred compensation and the change in value of executive pensions.

Slower growth in annual bonuses and long-term incentives drove the slowdown in growth.The report found that annual bonuses fell 2.5% in 2022 after rising 36.8% in the previous year.  In addition, the value of earned long-term incentives rose 10% in 2022, less than the 44% increase in 2021.

However, salaries for CEOs increased 3.1% in 2022, following a year in which the average CEO salary remained unchanged.

WTW’s report is based on 450 companies in the S&P 1500 that filed proxies disclosing 2022 pay by the end of April.