We Think The Compensation For Deutsche Börse AG's (ETR:DB1) CEO Looks About Right

Performance at Deutsche Börse AG (ETR:DB1) has been reasonably good and CEO Theodor Weimer has done a decent job of steering the company in the right direction. 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 19 May 2021. Here is our take on why we think the CEO compensation looks appropriate.

View our latest analysis for Deutsche Börse

How Does Total Compensation For Theodor Weimer Compare With Other Companies In The Industry?

At the time of writing, our data shows that Deutsche Börse AG has a market capitalization of €25b, and reported total annual CEO compensation of €6.2m for the year to December 2020. Notably, that's an increase of 13% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at €1.5m.

On comparing similar companies in the industry with market capitalizations above €6.6b, we found that the median total CEO compensation was €5.3m. So it looks like Deutsche Börse compensates Theodor Weimer in line with the median for the industry.

Component	2020	2019	Proportion (2020)
Salary	€1.5m	€1.5m	24%
Other	€4.7m	€4.0m	76%
Total Compensation	€6.2m	€5.5m	100%

On an industry level, roughly 47% of total compensation represents salary and 53% is other remuneration. Deutsche Börse pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Deutsche Börse AG's Growth

Deutsche Börse AG has seen its earnings per share (EPS) increase by 7.5% a year over the past three years. It achieved revenue growth of 6.5% over the last year.

We're not particularly impressed by the 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. 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 Deutsche Börse AG Been A Good Investment?

Deutsche Börse AG has served shareholders reasonably well, with a total return of 27% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

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. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 1 warning sign for Deutsche Börse that investors should look into moving forward.

Important note: Deutsche Börse is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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