Shareholders Will Probably Hold Off On Increasing Metsä Board Oyj's (HEL:METSB) CEO Compensation For The Time Being

CEO Mika Joukio has done a decent job of delivering relatively good performance at Metsä Board Oyj (HEL:METSB) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 25 March 2021. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Metsä Board Oyj

Comparing Metsä Board Oyj's CEO Compensation With the industry

According to our data, Metsä Board Oyj has a market capitalization of €3.4b, and paid its CEO total annual compensation worth €2.3m over the year to December 2020. That's a notable decrease of 9.3% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €511k.

For comparison, other companies in the same industry with market capitalizations ranging between €1.7b and €5.4b had a median total CEO compensation of €867k. Hence, we can conclude that Mika Joukio is remunerated higher than the industry median. Moreover, Mika Joukio also holds €3.4m worth of Metsä Board Oyj stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2020	2019	Proportion (2020)
Salary	€511k	€512k	22%
Other	€1.8m	€2.1m	78%
Total Compensation	€2.3m	€2.6m	100%

On an industry level, around 52% of total compensation represents salary and 48% is other remuneration. Metsä Board Oyj pays a modest slice of remuneration through salary, as compared 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.

Metsä Board Oyj's Growth

Over the past three years, Metsä Board Oyj has seen its earnings per share (EPS) grow by 4.2% per year. Its revenue is down 2.3% over the previous year.

We generally like to see a little revenue growth, but the modest EPS growth gives us some relief. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. 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 Metsä Board Oyj Been A Good Investment?

Most shareholders would probably be pleased with Metsä Board Oyj for providing a total return of 34% over three years. 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.

In Summary...

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. 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 Metsä Board Oyj that investors should think about before committing capital to this stock.

Important note: Metsä Board Oyj 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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This article by Simply Wall St is general in nature. 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.
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