We Discuss Why Randstad N.V.'s (AMS:RAND) CEO Will Find It Hard To Get A Pay Rise From Shareholders This Year

Key Insights

• Randstad to hold its Annual General Meeting on 26th of March
• Total pay for CEO Sander van't Noordende includes €1.26m salary
• The total compensation is 60% less than the average for the industry
• Over the past three years, Randstad's EPS fell by 46% and over the past three years, the total loss to shareholders 8.4%

Performance at Randstad N.V. (AMS:RAND) has not been particularly rosy recently and shareholders will likely be holding CEO Sander van't Noordende and the board accountable for this. The next AGM coming up on 26th of March will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. We think most shareholders will probably pass the CEO compensation, based on what we gathered.

See our latest analysis for Randstad

Comparing Randstad N.V.'s CEO Compensation With The Industry

Our data indicates that Randstad N.V. has a market capitalization of €7.5b, and total annual CEO compensation was reported as €2.1m for the year to December 2024. That's slightly lower by 7.5% over the previous year. We note that the salary of €1.26m makes up a sizeable portion of the total compensation received by the CEO.

In comparison with other companies in the Dutch Professional Services industry with market capitalizations ranging from €3.7b to €11b, the reported median CEO total compensation was €5.4m. Accordingly, Randstad pays its CEO under the industry median. What's more, Sander van't Noordende holds €2.2m worth of shares in the company in their own name.

Talking in terms of the industry, salary represented approximately 49% of total compensation out of all the companies we analyzed, while other remuneration made up 51% of the pie. According to our research, Randstad has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Randstad N.V.'s Growth

Randstad N.V. has reduced its earnings per share by 46% a year over the last three years. Its revenue is down 5.1% over the previous year.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Randstad N.V. Been A Good Investment?

Given the total shareholder loss of 8.4% over three years, many shareholders in Randstad N.V. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for Randstad that investors should think about before committing capital to this stock.

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.