I am a big admirer of Whole Foods and have written a few times about the company. Somehow, I managed to miss John Mackey’s blog. So when I saw this post titled Compensation at Whole Foods, I was captivated. It’s a letter to employees from the CEO talking in transparent terms about why they decided to increase executive pay multiples:

This will be the third time we have raised our salary cap since we created one about 20 years ago. The original salary cap was set at 8 times the average pay. It was raised to 10 times the average pay in the early 1990’s and raised again to 14 times the average pay in 2000. This increase to 19 times the average pay remains far, far below what the typical Fortune 500 company pays its executives. As you can see from the following chart, the average CEO received 431 times as much as their average employee received in 2004, while the Whole Foods Market CEO (me) received only 14 times the average employee pay in cash compensation.

The chart shows executive pay multiples that are astounding – $431 for every dollar that the average employee makes. It’s $14 for every dollar that the average employee makes at Whole Foods. And how much does Mr. Mackey make? $1. A buck. He says he has enough:

While it has become necessary to raise the salary cap at Whole Foods to help ensure the retention of our key leadership, this is not true in my case. The tremendous success of Whole Foods Market has provided me with far more money than I ever dreamed I’d have and far more than is necessary for either my financial security or personal happiness. I continue to work for Whole Foods not because of the money I can make but because of the pleasure I get from leading such a great company, and the ongoing passion I have to help make the world a better place, which Whole Foods is continuing to do.

A noble story, indeed. In these days of excess pay stories, the Whole Foods executive compensation story is compelling.

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