Macquarie Group Limited's (ASX:MQG) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Macquarie Group will host its Annual General Meeting on 25th of July
• CEO Shemara Wikramanayake's total compensation includes salary of AU$1.53m
• The total compensation is 128% higher than the average for the industry
• Over the past three years, Macquarie Group's EPS grew by 3.3% and over the past three years, the total shareholder return was 51%

Performance at Macquarie Group Limited (ASX:MQG) has been reasonably good and CEO Shemara Wikramanayake has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 25th of July. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Macquarie Group

How Does Total Compensation For Shemara Wikramanayake Compare With Other Companies In The Industry?

According to our data, Macquarie Group Limited has a market capitalization of AU$76b, and paid its CEO total annual compensation worth AU$29m over the year to March 2024. We note that's a small decrease of 3.4% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at AU$1.5m.

On comparing similar companies in the Australian Capital Markets industry with market capitalizations above AU$12b, we found that the median total CEO compensation was AU$13m. This suggests that Shemara Wikramanayake is paid more than the median for the industry. Moreover, Shemara Wikramanayake also holds AU$263m worth of Macquarie Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	AU$1.5m	AU$821k	5%
Other	AU$28m	AU$30m	95%
Total Compensation	AU$29m	AU$30m	100%

Talking in terms of the industry, salary represented approximately 61% of total compensation out of all the companies we analyzed, while other remuneration made up 39% of the pie. Macquarie Group sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Macquarie Group Limited's Growth Numbers

Over the past three years, Macquarie Group Limited has seen its earnings per share (EPS) grow by 3.3% per year. Its revenue is down 12% over the previous year.

We would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see a modest EPS growth at least. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Macquarie Group Limited Been A Good Investment?

Boasting a total shareholder return of 51% over three years, Macquarie Group Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for Macquarie Group that investors should look into moving forward.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com