We Think Shareholders Will Probably Be Generous With 3i Group plc's (LON:III) CEO Compensation

Key Insights

• 3i Group will host its Annual General Meeting on 27th of June
• CEO Simon Borrows' total compensation includes salary of UK£713.0k
• Total compensation is similar to the industry average
• Over the past three years, 3i Group's EPS grew by 27% and over the past three years, the total shareholder return was 194%

The performance at 3i Group plc (LON:III) has been quite strong recently and CEO Simon Borrows has played a role in it. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 27th of June. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. Here is our take on why we think CEO compensation is not extravagant.

View our latest analysis for 3i Group

How Does Total Compensation For Simon Borrows Compare With Other Companies In The Industry?

According to our data, 3i Group plc has a market capitalization of UK£30b, and paid its CEO total annual compensation worth UK£8.3m over the year to March 2024. We note that's a decrease of 13% compared to last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£713k.

For comparison, other companies in the British Capital Markets industry with market capitalizations above UK£6.3b, reported a median total CEO compensation of UK£6.4m. This suggests that 3i Group remunerates its CEO largely in line with the industry average. What's more, Simon Borrows holds UK£524m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	UK£713k	UK£687k	9%
Other	UK£7.6m	UK£8.8m	91%
Total Compensation	UK£8.3m	UK£9.5m	100%

Talking in terms of the industry, salary represented approximately 53% of total compensation out of all the companies we analyzed, while other remuneration made up 47% of the pie. 3i Group 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.

A Look at 3i Group plc's Growth Numbers

Over the past three years, 3i Group plc has seen its earnings per share (EPS) grow by 27% per year. It saw its revenue drop 16% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has 3i Group plc Been A Good Investment?

We think that the total shareholder return of 194%, over three years, would leave most 3i Group plc shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling 3i Group (free visualization of insider trades).

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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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com