Here's Why Oakajee Corporation Limited's (ASX:OKJ) CEO Compensation Is The Least Of Shareholders Concerns

Shareholders may be wondering what CEO Mark Jones plans to do to improve the less than great performance at Oakajee Corporation Limited (ASX:OKJ) recently. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 25 November 2022. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We think CEO compensation looks appropriate given the data we have put together.

View our latest analysis for Oakajee

Comparing Oakajee Corporation Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Oakajee Corporation Limited has a market capitalization of AU$2.9m, and reported total annual CEO compensation of AU$110k for the year to June 2022. That's mostly flat as compared to the prior year's compensation. We note that the salary portion, which stands at AU$100.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under AU$301m, the reported median total CEO compensation was AU$371k. This suggests that Mark Jones is paid below the industry median. Furthermore, Mark Jones directly owns AU$205k worth of shares in the company, implying that they are deeply invested in the company's success.

Speaking on an industry level, nearly 60% of total compensation represents salary, while the remainder of 40% is other remuneration. Oakajee pays out 91% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Oakajee Corporation Limited's Growth Numbers

Oakajee Corporation Limited's earnings per share (EPS) grew 20% per year over the last three years. Its revenue is down 59% over the previous year.

Shareholders would be glad to know that the company has improved itself over the last few years. While it would be good to see revenue growth, profits matter more in the end. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Oakajee Corporation Limited Been A Good Investment?

The return of -33% over three years would not have pleased Oakajee Corporation Limited shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

The loss to shareholders over the past three years is certainly concerning. This contrasts to the strong EPS growth recently however, and suggests that there may be other factors at play driving down the share price. A key question may be why the fundamentals have not yet been reflected into the share price. The upcoming AGM will provide shareholders the opportunity to raise their concerns and evaluate if the board’s judgement and decision-making is aligned with their expectations.

CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 4 warning signs for Oakajee that investors should look into moving forward.

Important note: Oakajee is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.