Shareholders May Be More Conservative With PSP Swiss Property AG's (VTX:PSPN) CEO Compensation For Now

CEO Giacomo Balzarini has done a decent job of delivering relatively good performance at PSP Swiss Property AG (VTX:PSPN) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 31 March 2021. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for PSP Swiss Property

Comparing PSP Swiss Property AG's CEO Compensation With the industry

According to our data, PSP Swiss Property AG has a market capitalization of CHF5.3b, and paid its CEO total annual compensation worth CHF1.8m over the year to December 2020. Notably, that's a decrease of 14% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CHF652k.

In comparison with other companies in the industry with market capitalizations ranging from CHF3.7b to CHF11b, the reported median CEO total compensation was CHF1.3m. This suggests that Giacomo Balzarini is paid more than the median for the industry. Furthermore, Giacomo Balzarini directly owns CHF5.8m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2020	2019	Proportion (2020)
Salary	CHF652k	CHF652k	36%
Other	CHF1.2m	CHF1.5m	64%
Total Compensation	CHF1.8m	CHF2.1m	100%

Talking in terms of the broader industry, salary and other compensation roughly make up 50% each, of the total compensation. PSP Swiss Property sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at PSP Swiss Property AG's Growth Numbers

Over the past three years, PSP Swiss Property AG has seen its earnings per share (EPS) grow by 4.4% per year. Its revenue is up 2.4% over the last year.

We'd prefer higher revenue growth, but the modest improvement in EPS is good. So there are some positives here, but not enough to earn high praise. 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 PSP Swiss Property AG Been A Good Investment?

Most shareholders would probably be pleased with PSP Swiss Property AG for providing a total return of 38% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

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. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 4 warning signs (and 2 which can't be ignored) in PSP Swiss Property we think you should know about.

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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