Australia’s top 10 CEOs reap $171m
The country's highest paid chief executives collectively receive $171.4 million, according to the Australian Council of Superannuation Investors (ACSI).
This figure was $70 million more than reported in their companies' FY14 annual reports, ACSI's "CEO Pay in ASX200 Companies" report found after exercising options and performance rights, along with the vesting of shares under long-term incentive schemes.
The report is the first to review what has actually been received by CEOs rather than the usual estimates of the value of their pay included in annual reports.
The council said shareholders now have an additional way of measuring whether the amounts flowing to executives are excessive, compared to the return on their investments.
ACSI's CEO, Louise Davidson, said "these figures suggest that the existing requirements for reporting executive pay may significantly understate the rewards received in a given year. Statutory reporting is, perhaps, disclosing only the tip of the iceberg in terms of wealth accruing to senior executives."
Davidson said company investors and owners cannot afford to lose sight of the quantum of reward being delivered.
"The bottom line test for any reward structure is, however, whether the outcome for the executives is aligned with that of the company's owners," she said.
The report found the highest realised pay went to Ramsay Health Care's Chris Rex at $30.8 million but his reported pay was at $9.1 million.
However, the most understated pay was Seek's Andrew Basset who reaped $17.95 million, largely in option exercises, well in excess of his reported pay of $4.21 million. This meant his reported rank of 41 jumped to fourth for realised pay.
The average realised pay in the ASX100 was found to be $5.63 million, compared to the average reported pay of $5.01 million.
Recommended for you
In this episode of Relative Return, host Maja Garaca Djurdjevic chats with Chris McGibbon, global head of real estate at Nuveen, about the long-term outlook and why the “knife has stopped falling” in property.
In this new episode of The Manager Mix, host Laura Dew speaks to Nick Paul, institutional portfolio manager at MFS Investment Management to delve into everything small and mid-cap equities.
In this episode of Relative Return, host Laura Dew chats with Kellie Wood, head of fixed income and deputy head of fixed income and multi-asset at Schroders Australia, to discuss why fixed income is returning to favour after a 12-year wait.
In this episode of Relative Return, host Laura Dew speaks with Michael Hunstad, deputy chief investment officer and chief investment officer of global equities at Northern Trust Asset Management, to debunk myths around index investing.
