In 2015 Bill Winters was appointed CEO of Standard Chartered PLC (LON:STAN). First, this article will compare CEO compensation with compensation at other large companies. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Bill Winters's Compensation Compare With Similar Sized Companies?
According to our data, Standard Chartered PLC has a market capitalization of UK£19b, and pays its CEO total annual compensation worth US$6.0m. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at US$1.2m. We took a group of companies with market capitalizations over UK£6.5b, and calculated the median CEO total compensation to be UK£3.9m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
As you can see, Bill Winters is paid more than the median CEO pay at large companies, in the same market. However, this does not necessarily mean Standard Chartered PLC is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Standard Chartered, below.
Is Standard Chartered PLC Growing?
Over the last three years Standard Chartered PLC has grown its earnings per share (EPS) by an average of 109% per year (using a line of best fit). It achieved revenue growth of 1.5% over the last year.
This demonstrates that the company has been improving recently. A good result. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.
Has Standard Chartered PLC Been A Good Investment?
With a total shareholder return of 0.8% over three years, Standard Chartered PLC has done okay by shareholders. But they would probably prefer not to see CEO compensation far in excess of the median.
We examined the amount Standard Chartered PLC pays its CEO, and compared it to the amount paid by other large companies. We found that it pays well over the median amount paid in the benchmark group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. We also think investors are doing ok, over the same time period. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Standard Chartered.
If you want to buy a stock that is better than Standard Chartered, this free list of high return, low debt companies is a great place to look.
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