Here's Why Shareholders May Want To Be Cautious With Increasing Givaudan SA's (VTX:GIVN) CEO Pay Packet

Key Insights

• Givaudan will host its Annual General Meeting on 20th of March
• Salary of CHF1.26m is part of CEO Gilles Andrier's total remuneration
• The overall pay is 57% above the industry average
• Givaudan's total shareholder return over the past three years was 13% while its EPS grew by 9.9% over the past three years

CEO Gilles Andrier has done a decent job of delivering relatively good performance at Givaudan SA (VTX:GIVN) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 20th of March. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for Givaudan

Comparing Givaudan SA's CEO Compensation With The Industry

At the time of writing, our data shows that Givaudan SA has a market capitalization of CHF37b, and reported total annual CEO compensation of CHF7.3m for the year to December 2024. That's a notable increase of 14% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at CHF1.3m.

On comparing similar companies in the Swiss Chemicals industry with market capitalizations above CHF7.1b, we found that the median total CEO compensation was CHF4.7m. This suggests that Gilles Andrier is paid more than the median for the industry. Furthermore, Gilles Andrier directly owns CHF22m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	CHF1.3m	CHF1.2m	17%
Other	CHF6.1m	CHF5.2m	83%
Total Compensation	CHF7.3m	CHF6.4m	100%

On an industry level, total compensation is equally proportioned between salary and other compensation, that is, they each represent approximately 50% of the total compensation. In Givaudan's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Givaudan SA's Growth

Givaudan SA has seen its earnings per share (EPS) increase by 9.9% a year over the past three years. In the last year, its revenue is up 7.2%.

We'd prefer higher revenue growth, but it is good to see modest EPS growth. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Givaudan SA Been A Good Investment?

Givaudan SA has served shareholders reasonably well, with a total return of 13% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed 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 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 Givaudan that investors should look into moving forward.

Switching gears from Givaudan, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.