The MBA Megabucks CEOs

The MBA megabucks CEOs

The news that Apple CEO Tim Cook earned a massive $378 million in 2011 is a shot in the arm for the idea that the MBA is a road to corporate riches. Admittedly the majority of his remuneration is in the form of stock options that do not vest for another 10 years, but the Duke-Fuqua MBA graduate is proof of a healthy ROI for an MBA.

Analysts understandably focus on Cook’s experience, composure and authority when it comes to running the iconic Palo Alto firm, and what is one of the toughest acts to follow in corporate history, but his days at business school don’t seem to have done him any harm.

So is the MBA the way to make the earnings super league?

Not if you are an entrepreneur. As the Forbes Wealthiest Billionaires list shows, the super rich are more likely to have dropped out of school (Bill Gates, Larry Ellison, Sheldon Adelson, Michael Dell, Mark Zuckerburg and Steve Jobs from the U.S., Eike Batista from Brazil, Mukesh Ambani from India, and Li-Kashing from Hong Kong). In the Forbes 2011 list, steel magnate Alexei Mordashov from Russia is the wealthiest MBA at #29, just ahead of Harvard MBA Michael Bloomberg. The only other MBAs to make the top 50 are fellow HBS graduate and hedge fund whizz John Paulson, and family successor of BMW Pharmaceuticals, Germany’s Susanne Klatten who got her MBA from IMD in Switzerland.

No, you are far more likely to make the higher reaches of the Billionaire List if you started from nothing and had something to prove (or at least a garage and a bright idea), were part of a family empire (Carlos Slim from Mexico, Christy Walton and other Walmart clan, and Liliane Bettencourt of L’Oréal), or have your hands on oil, metals and other commodities in Russia. If you do insist on graduate school, a Masters in Science would seem to be a good bet (Warren Buffett, Bernard Arnault of LVMH, the Koch brothers, and Google’s Larry Page and Sergey Brin all make the top 50).

The reality is that business school has a far higher success rate for graduates that make the corner office. An impressive 40 of the 100 best paid CEOs in corporate America last year have an MBA, according to the Forbes list.

Interestingly, there are plenty among them that graduated from business schools beyond the ‘usual suspects’ that dominate the MBA rankings – the likes of Washburn, Golden Gate, Indiana, Pace, Xavier University, New Orleans, Mississippi State, Case Western, Houston, Wisconsin, IIM Calcutta, George Washington, Rutgers and Loyola.

Only two women MBAs made the top MBA50 – Indra Nooyi, CEO at Pepsi Co. and Irene Rosenfeld at Kraft Foods. And though Chicago Booth, Wharton and MIT can boast of many highly successful and high-earning alumni, none of them made the best paid CEOs list last year. Stanford GSB has four to its name, Columbia can claim three, and Darden and Northwestern both have two alumni on the CEO list.

But the hands down winner is the Harvard Business School, with a remarkable twelve graduates who are among the top 50 best paid CEOs in corporate America last year with an MBA. Beyond developing leadership skills, such a presence says something about the courses they deliver in negotiation.

The MBA Megabucks CEOs top 10

NameCompany1 year-Pay ($m)Business School
1Edward A MuellerQwest Communications65.80Washburn
2Lew FrankfortCoach49.45Columbia
3John C MartinGilead Sciences42.72GoldenGate
4James T HackettAnadarko Petroleum38.94Harvard
5John T ChambersCisco Systems37.90Indiana
6Ivan G SeidenbergVerizon Commun36.75Pace
7Gregory T LucierLife Technologies33.75Harvard
8John H HammergrenMcKesson32.46XavierUniv
9Joseph M TucciEMC31.63Columbia
10Michael D WatfordUltra Petroleum30.04NewOrleans

 (source Forbes Best Paid CEOs published in 2011)

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