Earnings results suggest a wild ride for executive pay

Up until a few days ago, overall earnings growth for Australian listed companies disclosed so far for the year ended June 30 averaged 26%.  Preliminary indications from GuerdonData® suggest pay increases are also running at a similarly hectic pace.  But also, like last years’ results, the way the pay increase is being delivered may give rise to concerns.  Some of the increase is being delivered in bonus pay, some via LTI, and a surprising proportion in base pay. 

With next year’s earnings outlook, outside of the resources companies, not looking so good, we wonder if there is more attention than would otherwise be due to delivering pay increases via fixed pay rather than incentive pay.  This would lock in the good times forever, even if the good times no longer roll on.  This year’s and next year’s pay trends should be interesting, and will probably reveal widely divergent practices.

In early November we will give you an update of CEO pay trends and levels.  In the meantime, if you want an early peek at what is happening in your industry, as well as our best guesses on where things are going, drop us a line

© Guerdon Associates 2024
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