{"id":92156,"date":"2015-07-05T20:15:58","date_gmt":"2015-07-05T18:15:58","guid":{"rendered":"http:\/\/businesstech.co.za\/news\/?p=92156"},"modified":"2015-07-06T15:59:35","modified_gmt":"2015-07-06T13:59:35","slug":"ceo-pay-vs-performance-in-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/92156\/ceo-pay-vs-performance-in-south-africa\/","title":{"rendered":"CEO pay vs performance in South Africa"},"content":{"rendered":"

Globally, CEO pay is a hotly contested issue, especially in markets such as South Africa, where inequality and pay disparity is extremely high.<\/p>\n

Research has shown that South Africa has one of the largest pay gaps in the world – 5th highest – where CEOs earn, on average, 170 times more than their employees.<\/p>\n

The Wall Street Journal\u00a0recently revealed how US companies reward their chief executives handsomely, despite disappointing returns to shareholders.<\/p>\n

Read:\u00a0South Africa\u2019s massive wage gap<\/a><\/strong><\/p>\n

\n

Investor returns defined<\/h3>\n

Total shareholder return is an annualised percentage that is calculated by adding the appreciation in the share price and the total dividends paid to the shareholders.<\/p>\n<\/div>\n

Crunching numbers among South Africa’s biggest JSE-listed companies, it’s clear that the blue-chip firms deliver healthy returns for shareholders.<\/p>\n

Only two companies among the JSE’s top 20 showed a decline in share value over the past financial year, although dividends were still paid to shareholders in both cases.<\/p>\n

For the listing below, only companies that report financials in the local currency (with a majority listing in South Africa) are presented; thus\u00a0multinationals such as BAT, BHP Billiton and SAB Miller were excluded.<\/p>\n

The only exception to this is luxury goods company, Richemont, which is led and chaired by South Africa’s richest man, Johann Rupert.<\/p>\n

\n
\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Company<\/th>\nShare price open<\/th>\nShare price close<\/th>\nDividend<\/th>\nInvestor return (%)<\/th>\n<\/tr>\n
Telkom<\/td>\nR33.65<\/td>\nR79.20<\/td>\nR2.45<\/td>\n143%<\/td>\n<\/tr>\n
Naspers<\/td>\nR1 155.00<\/td>\nR1 773.56<\/td>\nR4.25<\/td>\n54%<\/td>\n<\/tr>\n
Sasol<\/td>\nR431.54<\/td>\nR632.63<\/td>\nR21.50<\/td>\n52%<\/td>\n<\/tr>\n
FirstRand<\/td>\nR28.93<\/td>\nR40.75<\/td>\nR1.74<\/td>\n47%<\/td>\n<\/tr>\n
Barclays Africa<\/td>\nR132.25<\/td>\nR182.00<\/td>\nR9.25<\/td>\n45%<\/td>\n<\/tr>\n
Sanlam<\/td>\nR53.24<\/td>\nR70.00<\/td>\nR2.25<\/td>\n36%<\/td>\n<\/tr>\n
Aspen<\/td>\nR227.07<\/td>\nR298.89<\/td>\nR1.57<\/td>\n32%<\/td>\n<\/tr>\n
Remgro<\/td>\nR189.95<\/td>\nR230.00<\/td>\nR2.33<\/td>\n22%<\/td>\n<\/tr>\n
Nedbank<\/td>\nR208.07<\/td>\nR243.00<\/td>\nR10.28<\/td>\n22%<\/td>\n<\/tr>\n
Bidvest<\/td>\nR244.95<\/td>\nR282.58<\/td>\nR4.32<\/td>\n17%<\/td>\n<\/tr>\n
Standard Bank<\/td>\nR128.59<\/td>\nR143.48<\/td>\nR5.98<\/td>\n16%<\/td>\n<\/tr>\n
Richemont<\/td>\nR100.05<\/td>\nR99.42<\/td>\nR13.69<\/td>\n13%<\/td>\n<\/tr>\n
Old Mutual<\/td>\nR32.99<\/td>\nR34.72<\/td>\nR1.67<\/td>\n10%<\/td>\n<\/tr>\n
MTN<\/td>\nR217.02<\/td>\nR221.41<\/td>\nR12.45<\/td>\n8%<\/td>\n<\/tr>\n
Vodacom<\/td>\nR129.99<\/td>\nR132.69<\/td>\nR7.75<\/td>\n8%<\/td>\n<\/tr>\n
Anglo American<\/td>\nR261.95<\/td>\nR224.29<\/td>\nR6.49<\/td>\n-12%<\/td>\n<\/tr>\n
Shoprite<\/td>\nR185.50<\/td>\nR154.00<\/td>\nR3.50<\/td>\n-15%<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n<\/div>\n

CEO Pay vs Investor return<\/h3>\n

The following graph plots the SA companies’ CEO salaries and percent returned to investors in their respective latest\u00a0financial years.<\/p>\n

Notably, Naspers has not yet published how much current CEO, Bob van Dijk was paid in the most recent financial year; however, the group has historically not paid CEO, Koos Bekker, a salary, instead opting to compensate the executive with shares in the company.<\/p>\n

\"Salaries<\/a>

Salaries vs Investor return (click to enlarge)<\/p><\/div>\n

\n
\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Company<\/th>\nCEO<\/th>\nSalary<\/th>\nInvestor return (%)<\/th>\nMarket Cap<\/th>\n<\/tr>\n
Telkom<\/td>\nSipho Maseko<\/td>\nR11.7 million<\/td>\n143%<\/td>\nR31.4 billion<\/td>\n<\/tr>\n
Naspers<\/td>\nBob van Dijk<\/td>\nTBA<\/td>\n54%<\/td>\nR795.7 billion<\/td>\n<\/tr>\n
Sasol<\/td>\nDavid Constable<\/td>\nR52.0\u00a0million<\/td>\n52%<\/td>\nR287.1 billion<\/td>\n<\/tr>\n
FirstRand<\/td>\nSizwe Nxasana<\/td>\nR29.5\u00a0million<\/td>\n47%<\/td>\nR298.0 billion<\/td>\n<\/tr>\n
Barclays Africa<\/td>\nMaria Ramos<\/td>\nR28.6\u00a0million<\/td>\n45%<\/td>\nR151.9 billion<\/td>\n<\/tr>\n
Sanlam<\/td>\nJohan van Zyl<\/td>\nR5.3\u00a0million<\/td>\n36%<\/td>\nR144.1 billion<\/td>\n<\/tr>\n
Aspen<\/td>\nStephen Saad<\/td>\nR15.3\u00a0million<\/td>\n32%<\/td>\nR163.9 billion<\/td>\n<\/tr>\n
Remgro<\/td>\nJannie Durand<\/td>\nR9.0\u00a0million<\/td>\n22%<\/td>\nR131.5 billion<\/td>\n<\/tr>\n
Nedbank<\/td>\nMike Brown<\/td>\nR35.1\u00a0million<\/td>\n22%<\/td>\nR119.1 billion<\/td>\n<\/tr>\n
Bidvest<\/td>\nBrian Joffe<\/td>\nR28.0\u00a0million<\/td>\n17%<\/td>\nR102.9 billion<\/td>\n<\/tr>\n
Standard Bank<\/td>\nBen Kruger, Sim Tshabalala<\/td>\nR21.7\u00a0million*<\/td>\n16%<\/td>\nR257.3 billion<\/td>\n<\/tr>\n
Richemont<\/td>\nJohann Rupert<\/td>\nR53.8\u00a0million<\/td>\n13%<\/td>\nR580.5 billion<\/td>\n<\/tr>\n
Old Mutal<\/td>\nJulian Roberts<\/td>\nR81.0\u00a0million<\/td>\n10%<\/td>\nR192.9 billion<\/td>\n<\/tr>\n
MTN<\/td>\nSifiso Dabengwa<\/td>\nR28.1\u00a0million<\/td>\n8%<\/td>\nR420.5 billion<\/td>\n<\/tr>\n
Vodacom<\/td>\nShameel Joosub<\/td>\nR20.8\u00a0million<\/td>\n8%<\/td>\nR205.9 billion<\/td>\n<\/tr>\n
Anglo American<\/td>\nMark Cutifani<\/td>\nR71.7\u00a0million<\/td>\n-12%<\/td>\nR253.3 billion<\/td>\n<\/tr>\n
Shoprite<\/td>\nWhitey Basson<\/td>\nR50.0\u00a0million<\/td>\n-15%<\/td>\nR99.0\u00a0billion<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n<\/div>\n

*Averaged<\/small><\/p>\n

Among the South African telecom operators, Telkom flew past both MTN and Vodacom – and indeed all the other top 20 companies – providing the biggest return to investors.<\/p>\n

Telkom was included in the findings in light of its recent return to dividend payouts, as well as its largely successful turnaround strategy.<\/p>\n

In its latest annual results, the group reinstated a dividend of 215 cents per share and a special dividend of 30 cents per share for the 2015 financial year – the first time since 2011.<\/p>\n

\"Total<\/a>

Total Shareholder Return in telecoms<\/p><\/div>\n

More on business and wealth<\/h3>\n

Your salary vs the rest of the world<\/a><\/strong><\/p>\n

Working for no salary is high risk, high reward: SA billionaire<\/a><\/strong><\/p>\n

11 things businesses hate about South Africa<\/a><\/strong><\/p>\n

Telkom planning to split its business<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

CEO pay is a hotly contested issue, but it stands to reason that it would be less so, as long as chief executives were driving companies to profitability and growth – and returning some of that wealth to investors.<\/p>\n","protected":false},"author":10,"featured_media":45198,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[5684,26,1170],"class_list":["post-92156","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-dividends","tag-headline","tag-investors"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/92156","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=92156"}],"version-history":[{"count":10,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/92156\/revisions"}],"predecessor-version":[{"id":92508,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/92156\/revisions\/92508"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/45198"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=92156"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=92156"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=92156"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}