Increases to EFG International AG's (VTX:EFGN) CEO Compensation Might Cool off for now

Under the guidance of CEO Giorgio Pradelli, EFG International AG (VTX:EFGN) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 29 April 2021. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for EFG International

How Does Total Compensation For Giorgio Pradelli Compare With Other Companies In The Industry?

Our data indicates that EFG International AG has a market capitalization of CHF2.4b, and total annual CEO compensation was reported as CHF3.1m for the year to December 2020. Notably, that's an increase of 15% over the year before. Notably, the salary which is CHF1.58m, represents a considerable chunk of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations ranging from CHF1.8b to CHF5.9b, the reported median CEO total compensation was CHF1.3m. Hence, we can conclude that Giorgio Pradelli is remunerated higher than the industry median. What's more, Giorgio Pradelli holds CHF2.0m worth of shares in the company in their own name.

Component	2020	2019	Proportion (2020)
Salary	CHF1.6m	CHF1.6m	52%
Other	CHF1.5m	CHF1.1m	48%
Total Compensation	CHF3.1m	CHF2.7m	100%

On an industry level, around 52% of total compensation represents salary and 48% is other remuneration. EFG International is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at EFG International AG's Growth Numbers

EFG International AG has seen its earnings per share (EPS) increase by 87% a year over the past three years. In the last year, its revenue is down 3.1%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has EFG International AG Been A Good Investment?

With a total shareholder return of 10% over three years, EFG International AG shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

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. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 2 warning signs for EFG International that investors should be aware of in a dynamic business environment.

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. 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.
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