Money's worth? Which Indiana CEOs deliver the best return?

• Author: Kaelble, Steve
• Position: Cover Story

You can almost hear the drum rolls as proxy statements arrive in investors' mailboxes in the spring. What did the CEO make this year? Did he or she get a raise? Did the chief executive cash in on a stock-option bonanza? Perhaps most important, did the CEO earn his or her keep?

It's a lucrative time to be a CEO, according to our analysis of financial filings from the 100 largest Indiana public companies. Their CEO's total compensation last year - including stock-option gains and long-term compensation - averaged $2.1 million. Even if one excludes options and retirement benefits, Indiana's CEOs in 1997 got raises averaging 19.2 percent, well ahead of the 3.3 percent raise recorded by the general public.

Once again, Steve Hilbert enjoyed a paycheck dwarfing all others. Though the chief of Carmel-based Conseco has a comparatively modest salary of $250,000, his generous profit-linked bonus, ample long-term benefits package and an astronomical gain on stock options added up to a Hilbert-record total of $119.4 million, three times his compensation last year. Leaving out option gains, Hilbert's pay still was up 20 percent over that of 1996.

That's not just a lot of money by Hoosier standards. Hilbert's pay nearly tops the national charts as well. This year's Forbes tally of CEO pay places Hilbert second in the nation, behind the Travelers Group's Sanford Weill. And Hilbert's 1997 was no fluke, Forbes observes. The Indiana executive places second on the five-year total compensation list, again behind Weill and a significant distance ahead of No. 3, Disney's Michael Eisner.

Most Bang for the Buck Profit earned per dollar of CEO's pay Ian M. Rolland Lincoln National, Fort Wayne $388.10 Dane A. Miller Biomet, Warsaw $314.45 Osamu Sawaragi National Steel, Mishawaka $224.74 Thomas L. Hefner Duke Really, Indianapolis $207.52 Gary L. Neale NIPSCO Industries, Merrillville $198.81 Ronald W. Dollens Guidant, Indianapolis $183.77 Ronald G. Reherman Sigcorp, Evansville $111.48 John N. Royse Old National Bancorp, Evansville $104.17 John R. Hodowal IPALCO Enterprises, Indianapolis $94.68 James A. Henderson Cummins Engine, Columbus $91.96 Yet Hilbert is far from the only Indiana CEO to strike it rich by cashing in stock options. Options clearly have become the compensation of choice for many companies. Take the case of Robert Laikin, CEO of Indianapolis-based Brightpoint. His salary and bonus totaled $900,000 in 1997, but exercising stock options brought his total...