The CEO Of Siemens Limited (NSE:SIEMENS) Might See A Pay Rise On The Horizon

Shareholders will probably not be disappointed by the robust results at Siemens Limited (NSE:SIEMENS) recently and they will be keeping this in mind as they go into the AGM on 04 February 2022. This would also be a chance for them to hear the board review the financial results, discuss future company strategy to further improve the business and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is fair and may even warrant a raise.

Check out our latest analysis for Siemens

Comparing Siemens Limited's CEO Compensation With the industry

According to our data, Siemens Limited has a market capitalization of ₹812b, and paid its CEO total annual compensation worth ₹223m over the year to September 2021. We note that's an increase of 15% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at ₹23m.

For comparison, other companies in the industry with market capitalizations above ₹602b, reported a median total CEO compensation of ₹494m. This suggests that Sunil Mathur is paid below the industry median.

Component	2021	2020	Proportion (2021)
Salary	₹23m	₹22m	10%
Other	₹201m	₹171m	90%
Total Compensation	₹223m	₹194m	100%

On an industry level, roughly 77% of total compensation represents salary and 23% is other remuneration. It's interesting to note that Siemens allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Siemens Limited's Growth

Over the past three years, Siemens Limited has seen its earnings per share (EPS) grow by 5.2% per year. It achieved revenue growth of 37% over the last year.

We like the look of the strong year-on-year improvement in revenue. Combined with modest EPS growth, we get a good impression of the company. We wouldn't say this is necessarily top notch growth, but it is certainly promising. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Siemens Limited Been A Good Investment?

We think that the total shareholder return of 124%, over three years, would leave most Siemens Limited shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Overall, the company hasn't done too poorly performance-wise, but we would like to see some improvement. Assuming the business continues to grow at a good clip, few shareholders would raise any objections to the CEO's remuneration. Rather, investors would more likely want to engage on discussions related to key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Siemens (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.