We Think Some Shareholders May Hesitate To Increase Iberdrola, S.A.'s (BME:IBE) CEO Compensation

Key Insights

• Iberdrola's Annual General Meeting to take place on 30th of May
• Salary of €1.00m is part of CEO Armando Martínez's total remuneration
• The total compensation is 79% higher than the average for the industry
• Iberdrola's total shareholder return over the past three years was 60% while its EPS grew by 9.3% over the past three years

We've discovered 2 warning signs about Iberdrola. View them for free.

CEO Armando Martínez has done a decent job of delivering relatively good performance at Iberdrola, S.A. (BME:IBE) 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 30th of May. However, some shareholders may still want to keep CEO compensation within reason.

View our latest analysis for Iberdrola

How Does Total Compensation For Armando Martínez Compare With Other Companies In The Industry?

Our data indicates that Iberdrola, S.A. has a market capitalization of €101b, and total annual CEO compensation was reported as €3.3m for the year to December 2024. Notably, that's an increase of 72% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at €1.0m.

In comparison with other companies in the Spain Electric Utilities industry with market capitalizations over €7.1b, the reported median total CEO compensation was €1.8m. Hence, we can conclude that Armando Martínez is remunerated higher than the industry median.

Component	2024	2023	Proportion (2024)
Salary	€1.0m	€1.0m	31%
Other	€2.3m	€895k	69%
Total Compensation	€3.3m	€1.9m	100%

Talking in terms of the broader industry, salary and other compensation roughly make up 50% each, of the total compensation. It's interesting to note that Iberdrola allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Iberdrola, S.A.'s Growth Numbers

Iberdrola, S.A. has seen its earnings per share (EPS) increase by 9.3% a year over the past three years. Its revenue is down 3.5% over the previous year.

We would prefer it if there was revenue growth, but the modest EPS growth gives us some relief. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Iberdrola, S.A. Been A Good Investment?

We think that the total shareholder return of 60%, over three years, would leave most Iberdrola, S.A. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar 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. 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 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. That's why we did some digging and identified 2 warning signs for Iberdrola that you should be aware of before investing.

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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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.