Executive pay in Saudi Arabia is becoming a more strategic decision than ever before.
As organisations expand, international companies establish regional operations in Riyadh, Saudi businesses compete for specialist leadership talent, and Vision 2030 continues to reshape the economy, executive remuneration can no longer be approached as a simple salary comparison.
Pay too little and an organisation may struggle to attract or retain the leadership capabilities required for growth.
Pay too much—or structure reward without sufficient connection to performance, role complexity and business strategy—and the organisation can create unnecessary cost, internal inequity and governance concerns.
That is why executive pay benchmarking in Saudi Arabia should go far beyond asking:
“What does another company pay its CEO or CFO?
Effective benchmarking considers organisational size, sector, ownership structure, role scope, business complexity, Saudi and international talent markets, performance expectations and the complete reward package.
For organisations in Riyadh, Jeddah and across the Kingdom, an experienced reward consultancy in Saudi Arabia can combine market evidence with commercial judgement to help boards, remuneration committees, CEOs and HR leaders make more defensible reward decisions.
Saudi Vision 2030 itself identifies attracting relevant foreign talent, developing human capital and aligning capabilities with labour-market requirements among the Kingdom’s strategic objectives. Saudi Vision 2030
What Is Executive Pay Benchmarking in Saudi Arabia?
Executive pay benchmarking is the structured process of comparing a senior leadership role and its total remuneration against an appropriate external market.
The purpose is not simply to identify an “average Saudi salary”.
It is to understand :
- what comparable organisations pay;
- which organisations genuinely compete for similar leadership talent;
- how the executive’s responsibilities compare
- how fixed and performance-linked reward is structured; and
- whether the organisation’s overall proposition is competitive and sustainable.
A meaningful Saudi executive benchmark may examine :
Reward elementWhat should be reviewedBasic salaryFixed contractual executive salaryHousingHousing provision or contractual housing allowanceTransportationCompany transport/car allowance or cash allowanceAnnual incentiveTarget and maximum annual bonusLong-term incentivesLTIPs, shares, equity or deferred incentivesBenefitsMedical insurance and executive benefitsOther allowancesRole-specific or contractual allowancesEnd-of-service benefitsApplicable end-of-service obligationsTotal cashFixed cash plus annual incentiveTotal direct compensationFixed + variable + long-term incentive valuePay mixRelationship between fixed and performance-linked rewardSaudi employment arrangements can include basic wage alongside contractual benefits and allowances such as housing and transportation, making it particularly important not to benchmark basic salary in isolation. HRSD
Why Executive Pay Benchmarking Matters in Saudi Arabia
Saudi Arabia’s leadership market is changing rapidly.
The Kingdom is developing new industries, attracting international investment and creating increasingly sophisticated leadership requirements across sectors including financial services, technology, healthcare, tourism, logistics, construction, professional services and major transformation programmes.
The Regional Headquarters programme adds another dimension. Saudi Arabia’s Ministry of Investment describes RHQ as a programme encouraging global businesses to establish regional headquarters in the Kingdom; by August 2026, MISA reported that more than 750 companies had joined the programme. MISA Eservices
This creates greater competition for people capable of managing Saudi, GCC and international operations.
The benchmarking question therefore becomes:
What does the relevant talent market pay, which market should we compare ourselves with, and what reward structure best supports our strategy?
That is significantly more useful than simply asking for a Saudi executive salary survey.
What Makes a Saudi Executive Pay Benchmark Reliable?
Not every salary comparison is meaningful.
One of the biggest benchmarking risks is comparing organisations that look similar by job title but are fundamentally different in scale or complexity.
A CEO managing a Saudi family-owned company with SAR 300 million revenue should not automatically be compared with a CEO responsible for a diversified multinational group with operations across several countries.
The title may be identical.
The role value may be completely different.
A robust executive compensation benchmarking exercise in Saudi Arabia should consider factors such as:
Company factors : revenue, assets, employee population, industry, ownership structure, profitability, geographic footprint and organisational complexity.
Role factors : reporting relationships, P&L accountability, number of employees managed, strategic responsibilities, transformation mandate and decision-making authority.
Talent-market factors : whether the organisation recruits primarily from Saudi Arabia, GCC markets, multinational organisations or global specialist markets.
Individual factors: experience, capability, scarcity of skills and maturity in the role.
Peer Group Selection Is Critical
The quality of an executive benchmark depends heavily on the organisations selected for comparison.
Before building a peer group, organisations should ask :
Who genuinely competes with us for leadership talent?
Which companies operate at a comparable scale?
Which organisations have similar ownership and decision-making complexity?
Would their executives realistically join our organisation?
Would our executives realistically move to them?
For some Saudi companies, a purely domestic peer group may be appropriate.
For others, a better benchmarking model may combine :
Saudi peers + GCC competitors + carefully selected international comparators.
The objective is not to create the largest comparison group.
It is to create the most relevant market.
Benchmark the Whole Executive Package
- Looking only at salary can create a seriously distorted picture.
- Consider two executives who both receive the same basic annual salary.
- Executive A may receive a relatively modest annual incentive.
- Executive B may receive a much larger performance bonus, company shares, long-term incentives and additional executive benefits.
- Their base salaries may look identical.
- Their total reward opportunity is not.
Good executive compensation benchmarking in KSA should therefore examine several market views:
Fixed compensation → Total fixed cash → Target total cash → Maximum total cash → Long-term incentive value → Total direct compensation
This gives decision-makers a more realistic understanding of competitiveness.
Understanding Market Percentiles
Benchmarking reports commonly use the :
25th percentile
50th percentile / median
75th percentile
The median represents the midpoint of the selected market.
But Saudi organisations should not automatically decide:
We pay at the median.
Market positioning should reflect the organisation’s circumstances.
A company may legitimately pay above median where the role has exceptional complexity, scarce expertise is required, substantial transformation is underway or the organisation is competing internationally for talent.
Another organisation may position fixed pay closer to median while offering greater upside for exceptional performance.
The benchmark should inform judgement—not replace it.
Executive Pay and Saudi Corporate Governance
For Saudi listed companies, executive remuneration is also a governance issue.
The Capital Market Authority’s Corporate Governance Regulations give remuneration committees responsibilities including establishing remuneration policy, reviewing its effectiveness and making recommendations regarding senior executives.
The regulations state that remuneration policies should be consistent with company strategy and objectives, encourage long-term success, consider responsibilities and performance, and take account of market practices without allowing comparisons to produce unjustifiable increases in remuneration. هيئة السوق المالية
This is an important principle for benchmarking :
External market data should support the remuneration decision. It should not automatically determine it.
For applicable listed companies, the CMA framework also requires transparent remuneration disclosures through the Board reporting process. هيئة السوق المالية
A strong Saudi benchmarking process therefore needs to answer not only:
“What does the market pay?”
but also :
“Why is this market relevant?”
“Why have we chosen this position?”
“How does the package support company performance and long-term objectives?”
Vision 2030 Is Changing the Executive Talent Market
Vision 2030 makes executive benchmarking particularly important because Saudi Arabia is not operating in a static labour market.
Major economic diversification and human-capability initiatives are changing demand for leadership expertise.
Organisations increasingly require executives capable of handling transformation, localisation, digitalisation, international partnerships, new-market development and organisational scaling.
This can create talent premiums for certain leadership capabilities.
But organisations should resist assuming that every “Vision 2030 role” automatically requires premium compensation.
The organisation still needs to evaluate:
Role scope + organisational scale + talent scarcity + performance expectations + relevant market evidence.
Saudization and Reward Strategy
Saudization should also be considered as part of the wider workforce and talent strategy.
Saudi Arabia entered a new phase of the Nitaqat Mutawar programme in 2026, with the Ministry of Human Resources and Social Development stating that the three-year phase is intended to support localisation of more than 340,000 additional private-sector jobs. HRSD
There are also profession-specific localisation requirements.
For example, 2026 changes included increased Saudization rates for marketing, sales and procurement professions. HRSD
This does not mean every executive position should be benchmarked using a “Saudi premium”.
Instead, organisations should analyse whether localisation requirements, Saudi talent availability, succession planning and competition for qualified Saudi professionals materially affect the relevant role.
This creates a more sophisticated approach:
Talent availability → localisation requirements → succession pipeline → market positioning → reward strategy.
Executive Pay Benchmarking for Private and Family Businesses
- Benchmarking is equally valuable outside listed companies.
- Saudi private and family-owned businesses often face different executive reward questions.
- A founder-led organisation may be transitioning towards professional management.
- A family business may need to distinguish shareholder return from management compensation.
- A private-equity-backed organisation may require stronger performance or value-creation incentives.
- A rapidly growing Saudi business may suddenly be competing against multinational employers.
- In these situations, copying the remuneration practices of large Tadawul-listed organisations is unlikely to produce a good answer.
- The benchmark needs to reflect the business the organisation actually is and the business it is becoming.
When Should a Saudi Business Review Executive Pay?
Executive benchmarking is particularly useful when an organisation is:
- recruiting a CEO, CFO, CHRO or senior executive;
- entering Saudi Arabia;
- establishing a regional headquarters in Riyadh;
- undergoing rapid expansion;
- restructuring its leadership team;
- reviewing annual executive compensation;
- preparing succession plans;
- introducing a short- or long-term incentive programme;
- preparing for an IPO;
- completing an acquisition;
- creating a new business division;
- facing executive-retention risks;
- professionalising a family business; or
- transforming its operating model.
The best time to benchmark executive reward is usually before a critical retention or recruitment problem appears.
Common Executive Benchmarking Mistakes in Saudi Arabia
Several mistakes can significantly reduce the quality of a KSA compensation study.
Using job titles instead of role size. Two “Chief Operating Officers” may manage completely different levels of complexity.
Using Riyadh salary data without checking the actual talent market. Some roles compete nationally, others across the GCC or globally.
Mixing Saudi and UAE compensation without adjustment. GCC markets are connected, but reward practices, benefits and talent dynamics are not identical.
Looking only at basic salary. This ignores allowances, bonuses, long-term incentives and other reward elements.
Automatically paying at the 75th percentile. Higher market positioning should have a clear business rationale.
Benchmarking against companies that are much larger. This can artificially inflate executive compensation.
Ignoring ownership structure. Listed, family-owned, government-related, multinational and PE-backed organisations may require different reward models.
Why Work With an Independent Reward Consultancy in Riyadh?
- Executive compensation is rarely just an HR issue.
- The board wants governance.
- The CEO wants leadership capability.
- HR wants attraction, retention and internal fairness.
- Finance wants sustainable cost.
- Shareholders want performance alignment.
- Employees may compare senior leadership rewards with broader workforce outcomes.
A specialist reward consultancy in Riyadh or Saudi Arabia can provide independent evidence to support these competing considerations.
A strong adviser should do more than deliver a spreadsheet of salaries.
They should help the organisation :
define the correct peer market → evaluate role size → analyse total compensation → test pay positioning → assess incentive structure → model potential outcomes → make practical recommendations.
What Should an Executive Benchmarking Project Include?
A strong project normally begins with the business—not the salary database.
Consultants should first understand :
Business strategy
Organisation size
Ownership structure
Role responsibilities
Saudi/GCC/global recruitment market
Current reward philosophy
Performance expectations
Existing compensation structure
Roles can then be matched against appropriate market evidence.
A useful final executive benchmarking report may include :
market percentiles, peer-group rationale, current positioning, fixed-pay comparisons, target bonus opportunities, total cash analysis, long-term incentives, total direct compensation, pay-mix analysis and recommendations.
Scenario modelling can further show potential executive reward at :
Threshold performance → Target performance → Maximum performance
That is considerably more useful than a single salary figure.
Saudi Executive Reward Needs a Wider Market Perspective
Riyadh is increasingly competing within a regional and global executive talent market.
For some positions, Saudi market data will be sufficient.
For others, organisations may need to assess :
Saudi Arabia → GCC → Middle East → selected global markets.
But international benchmarking should be used carefully.
US, European, UAE and Saudi remuneration structures may differ substantially.
Raw international salary numbers should therefore not simply be converted into SAR.
The organisation needs to understand the underlying reward structure and the market from which the executive could realistically be recruited.
From Executive Pay Data to Better Decisions
Strong executive benchmarking follows three stages :
Evidence → Interpretation → Decision
Evidence tells the organisation what relevant companies are paying.
Interpretation explains why those organisations and data points are relevant.
Decision determines what reward strategy makes sense for the organisation.
Skipping the interpretation stage is one of the biggest mistakes companies make.
A salary survey number may look precise while still being completely wrong for the organisation.
The objective is not to follow the market blindly.
The objective is to make a competitive, commercially appropriate and defensible executive reward decision.
Looking for Executive Pay Benchmarking in Saudi Arabia?
Whether your organisation is hiring a new CEO, reviewing senior leadership compensation, entering the Saudi market, establishing a Riyadh headquarters or redesigning its executive reward strategy, independent market evidence can create significantly greater confidence in the decision.
A specialist reward consultancy in Saudi Arabia can help establish appropriate executive peer groups, benchmark fixed and variable compensation, assess total reward positioning and turn market data into clear recommendations for boards, remuneration committees and HR leaders.
A good benchmarking exercise should ultimately answer three questions:
Are we competitive?
Is our executive reward structure appropriate for our organisation and Saudi talent market?
Can we clearly explain and defend the decisions we make?
When all three answers are yes, executive pay benchmarking becomes a strategic management tool rather than an annual salary exercise.
Frequently Asked Questions
What is executive pay benchmarking in Saudi Arabia?
Executive pay benchmarking compares senior leadership compensation with relevant Saudi, GCC or international market data. It can assess basic salary, allowances, annual incentives, long-term incentives, benefits and total direct compensation.
Should Saudi companies benchmark only against Saudi organisations?
No. The appropriate comparator market depends on where the organisation genuinely recruits and loses talent. Some roles require Saudi benchmarks, while others may require GCC or selected international comparisons.
Is executive salary benchmarking enough?
Usually not. Executive competitiveness should normally be assessed using the complete reward package rather than basic salary alone.
How often should executive pay be benchmarked in KSA?
Many organisations conduct annual remuneration reviews, while more detailed benchmarking may be required following major recruitment, restructuring, rapid business growth, market entry, IPO preparation, incentive redesign or retention concerns.
Does executive benchmarking matter for private Saudi companies?
Yes. Private, family-owned and rapidly growing organisations can benefit significantly from external benchmarking, particularly when professionalising management or competing with larger organisations for executive talent.
What does a reward consultancy in Riyadh do?
A reward consultancy can support salary and executive benchmarking, reward strategy, job evaluation, salary structures, executive incentives, bonus plans, long-term incentives, remuneration governance and total reward design.
How does Saudization affect executive reward benchmarking?
The impact depends on the role and applicable localisation requirements. Organisations should consider Saudi talent availability, workforce localisation requirements, succession pipelines and realistic recruitment markets rather than applying a generic adjustment across all executive positions.
What should a Saudi executive remuneration committee consider?
For applicable listed companies, the CMA framework emphasises remuneration policies aligned with business strategy, responsibilities, performance and long-term company success, alongside appropriate disclosure and governance.
