It's Unlikely That Givaudan SA's (VTX:GIVN) CEO Will See A Huge Pay Rise This Year

Under the guidance of CEO Gilles Andrier, Givaudan SA (VTX:GIVN) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 25 March 2021. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

Check out our latest analysis for Givaudan

How Does Total Compensation For Gilles Andrier Compare With Other Companies In The Industry?

Our data indicates that Givaudan SA has a market capitalization of CHF33b, and total annual CEO compensation was reported as CHF6.6m for the year to December 2020. That's a modest increase of 4.4% on the prior year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CHF1.2m.

On comparing similar companies in the industry with market capitalizations above CHF7.4b, we found that the median total CEO compensation was CHF4.1m. This suggests that Gilles Andrier is paid more than the median for the industry. Furthermore, Gilles Andrier directly owns CHF14m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2020	2019	Proportion (2020)
Salary	CHF1.2m	CHF1.2m	18%
Other	CHF5.4m	CHF5.1m	82%
Total Compensation	CHF6.6m	CHF6.3m	100%

Speaking on an industry level, nearly 56% of total compensation represents salary, while the remainder of 44% is other remuneration. In Givaudan's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Givaudan SA's Growth

Givaudan SA's earnings per share (EPS) grew 1.0% per year over the last three years. In the last year, its revenue is up 1.9%.

We would argue that the improvement in revenue is good, but isn't particularly impressive, but the modest improvement in EPS is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Givaudan SA Been A Good Investment?

Boasting a total shareholder return of 76% over three years, Givaudan SA has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus 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. That's why we did some digging and identified 1 warning sign for Givaudan that investors should think about before committing capital to this stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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