How Should Investors Feel About Thomson Reuters Corporation's (TSE:TRI) CEO Pay?

Jim Smith has been the CEO of Thomson Reuters Corporation (TSE:TRI) since 2012. First, this article will compare CEO compensation with compensation at other large companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Thomson Reuters

How Does Jim Smith's Compensation Compare With Similar Sized Companies?

According to our data, Thomson Reuters Corporation has a market capitalization of CA$33.0b, and pays its CEO total annual compensation worth US$10m. That's actually a decrease on the year before. We took a group of companies with market capitalizations over US$8.0b, and calculated the median CEO compensation to be US$7m.

It would therefore appear that Thomson Reuters Corporation pays Jim Smith more than the median CEO remuneration at large companies, in the same market. However, this fact alone doesn't mean the remuneration is too high. 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 Thomson Reuters, below.

Is Thomson Reuters Corporation Growing?

On average over the last three years, Thomson Reuters Corporation has shrunk earnings per share by 4.1% each year. Its revenue is up 39% over last year.

As investors, we do are a bit wary of companies that have lower earnings per share, over three years. On the other hand, the strong revenue growth suggests the business is growing. It's hard to reach a conclusion about business performance right now. This may be one to watch.

You might want to check this free visual report on analyst forecasts for future earnings.

Has Thomson Reuters Corporation Been A Good Investment?

Thomson Reuters Corporation has generated a total shareholder return of 19% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

We compared total CEO remuneration at Thomson Reuters Corporation with the amount paid at other large companies. As discussed above, we discovered that the company pays more than the median of that group.

One might like to have seen stronger growth, and the shareholder returns have failed to inspire, over the last three years. So it's certainly hard to argue that the CEO is modestly paid, although we don't see the remuneration as an issue. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Thomson Reuters Corporation.

Or you could feast your eyes on this interactive graph depicting past earnings, cash flow and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.

Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.