23 January 2022
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What our top CEOs earn is incredible!

Peter Switzer
29 November 2021

Today’s a day that all CEOs of listed companies will be watching the stock market feeds to see if the consensus of buyers and sellers is that their companies and their share prices are threatened by this new variant of the Coronavirus called Omicron.

It comes as the AFR last week told us what top CEOs pocket for showing up to work and running their businesses — and the money is serious moolah!

Here’s a quick summary so you can benchmark yourself against our top CEOs:

• Top 50 CEOs earned on average $6.18 million!

• Average CEO pay rose 24% last financial year!

• Last year’s biggest pay rise: Ruslan Kogan of kogan.com — his increase was $8.4 million, which means he’s $9 million a year!

• Highest paid CEO is Macquarie Group CEO Shemara Wikramanayake on $15.97 million.

• The highest paid big bank CEO was Commonwealth Bank’s Matt Comyn but he is just 15th overall on $6.29 million.

I could go on but the more you see, the more annoyed you might become, especially when you know someone like Lendlease’s Steve McCann received $10.1 million, despite the fact that his share price has absolutely tanked.

And what happens to a company’s share price is the critical issue when it comes to what people are paid at public companies.

Let’s check out Lend Lease. I’m a shareholder so I’m definitely speaking through my wallet.

Lend Lease (LLC)

Sure the company has been hit by the Coronavirus, the lockdowns, the work-from-home trend and CBD offices losing value. It was a $19 stock before the pandemic and is now $10.80. Mr McCann’s pay looks over-rewarded, especially when you look at the five-year story.

Now have a look at Shemara Wikramanayake’s stock price result since she took over Macquarie in December 2018.

Macquarie Group (MQG)

The company has been a ripper for more than five years, and since Shemara became CEO, its share price is up over 70%, which is pretty good considering it has gone through the Coronavirus crash in March 2020.

I don’t care what she earns, as long as she keeps the share price heading up.

Another big pay CEO is Greg Goodman of the Goodman Group, who takes home $13.38 million via salary, bonuses and so on. And his share price performance shows why he’s on the big bucks.

Goodman Group (GMG)

Greg has benefitted from the Coronavirus and the escalation of buying online that has helped his warehousing properties. But his vision around industrial parks explains why his share price is up 278% in five years, and easily explains why he’s paid so much.

One guy the AFR used in order to attract more readers is the controversial Ruslan Kogan, founder and CEO of kogan.com, who gave himself a pay rise of $8.4 million! But interestingly, it meant his pay was now $9 million!

So he must have been on $600,000 for the year before, which deserves an exclamation mark! This brought about a shareholder backlash, with 42% voting against the rise. Looking at the share price explains a lot about this pay hike and the cheesed off shareholders.

Kogan.com (KGN)

Before the crash, this was a $7 stock, which fell to $4 then surged to $25 by October 2020, but since has fallen to $8. Shareholders have enjoyed the highs but they didn’t last. Maybe the threat of this Omicron variant will make the market fall in love with kogan.com again but unless we go into extended lockdowns, I doubt if shareholders will see a $25 share price any time soon.

One final take on Ruslan Kogan, which shows what he does with his big pay rise. As the AFR’s Patrick Durkin explained: “Mr Kogan spent about $20 million to buy his parents a home a few streets from his mansion in Melbourne’s upmarket Toorak in November to pay back the care of the Belarusian immigrants who staked everything to move to Australia and raise their family in a housing commission flat.”

(Read the full story from the AFR here.)

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