{"id":145821,"date":"2016-12-05T19:00:49","date_gmt":"2016-12-05T17:00:49","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=145821"},"modified":"2016-12-05T17:38:25","modified_gmt":"2016-12-05T15:38:25","slug":"the-truth-about-ceo-pay-in-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/wealth\/145821\/the-truth-about-ceo-pay-in-south-africa\/","title":{"rendered":"The truth about CEO pay in South Africa"},"content":{"rendered":"

Recent data from Bloomberg showed that South African CEOs are some of the highest paid in the world – however new local data shows that the numbers may be overblown.<\/p>\n

Analysis done by Bloomberg <\/a>in November showed that South African CEOs were ranked as the 7th best-paid executives in the world, with an average salary of R102 million.<\/p>\n

This high value raised eyebrows with local remuneration companies, who questioned how the number was reached.<\/p>\n

It was determined that two factors were at play – first, executives who earn in foreign currency skewed the data, and second, CEO share holdings were taken into account, which is not a fair reflection of the market.<\/p>\n

R100 million salaries for locally based executives are rare<\/a>, even with added bonuses and shares attached to the deal.<\/p>\n

According to the latest salary survey data<\/a><\/strong> released by remuneration experts, 21st Century Consultants, while still many times greater then the average employee, South African CEO salaries are far more muted than Bloomberg suggests.<\/p>\n

The group’s 21st Century Executive Pay Barometer for 2016 reveals the median salaries for CEOs, CFOs and executive directors in South Africa:<\/p>\n

\n
\n

Median Salaries for SA executives, 2016<\/strong><\/p>\n

\n\n\n\n\n\n
Executive<\/th>\nSmall Cap<\/th>\nMedium Cap<\/th>\nLarge Cap<\/th>\n<\/tr>\n
CEO<\/td>\nR2 531 000<\/td>\nR3 044 000<\/td>\nR5 745 000<\/td>\n<\/tr>\n
CFO<\/td>\nR1 560 000<\/td>\nR1 953 000<\/td>\nR3 436 000<\/td>\n<\/tr>\n
Executive Director<\/td>\nR1 693 500<\/td>\nR2 170 000<\/td>\nR3 654 000<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n<\/div>\n

Excluding CEOs that earn in foreign currency<\/em><\/p>\n

\n

According to 21st Century, over the past year, CFOs have received the highest median salary increase of 8%, with CEOs following closely with a median of 7.6% and executive directors with a median increase of 7%.<\/p>\n

“All three of these medians are in excess of the median for general staff employees according to 21st Century\u2019s increase report,” the group said.<\/p>\n

The Bloomberg report showed that the average South African CEO had an average salary around 500 times greater than the average employee – however 21st Century’s data showed that the earnings gap is far smaller – from around 9 times greater for CEOs at smallcap companies, 11 times at mid-cap companies, to 20 times at large cap companies.<\/p>\n

This is how wage gaps differ across company size and industry:<\/p>\n

\"salary-gap\"<\/a><\/p>\n

The group also noted that much of CEOs final pay is made up of long and short-term incentives, reaching as high as 165% for CEOs at large companies.<\/p>\n

Other CEO salary data<\/strong><\/p>\n

21st Century’s data is more in line with previous data and research into executive pay in South Africa.<\/p>\n

Research published earlier in the year found that the average salary for a CEO of listed company in South Africa was R5.3 million \u2013 shooting up to R9 million<\/strong> when bonuses and incentives are included.<\/p>\n

For other executives, the average basic salary was R4 million, jumping to R7 million<\/strong> with short and long-term incentives included.<\/p>\n

Executives who earn in local currency were paid less, overall, with an average of R3.4 million<\/strong> (R5.7 million including incentives)<\/strong>, versus those earning in other currencies, which averaged a basic salary of R7.8 million (R16 million with incentives)<\/strong>.<\/p>\n

Research conducted by PwC<\/a> on executive pay found that the average salary among CEOs ranges between R3.06 million and R7.14 million<\/strong>.<\/p>\n

Read:\u00a0How much money the \u201caverage Joe\u201d CEO earns in South Africa<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Recent data from Bloomberg showed that South African CEOs are some of the highest paid in the world (relative to the markets in which they work) – however new local data shows that the numbers may have been overblown.<\/p>\n","protected":false},"author":10,"featured_media":128221,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9880],"tags":[26],"class_list":["post-145821","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-wealth","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/145821","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=145821"}],"version-history":[{"count":9,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/145821\/revisions"}],"predecessor-version":[{"id":145845,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/145821\/revisions\/145845"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/128221"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=145821"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=145821"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=145821"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}