Shareholders Will Most Likely Find Van Lanschot Kempen NV's (AMS:VLK) CEO Compensation Acceptable

Key Insights

• Van Lanschot Kempen's Annual General Meeting to take place on 22nd of May
• CEO Maarten Edixhoven's total compensation includes salary of €1.28m
• The total compensation is similar to the average for the industry
• Van Lanschot Kempen's total shareholder return over the past three years was 205% while its EPS was down 2.4% over the past three years

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Despite strong share price growth of 205% for Van Lanschot Kempen NV (AMS:VLK) over the last few years, earnings growth has been disappointing, which suggests something is amiss. Some of these issues will occupy shareholders' minds as the AGM rolls around on 22nd of May. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. From what we gathered, we think shareholders should be wary of raising CEO compensation until the company shows some marked improvement.

View our latest analysis for Van Lanschot Kempen

Comparing Van Lanschot Kempen NV's CEO Compensation With The Industry

According to our data, Van Lanschot Kempen NV has a market capitalization of €2.4b, and paid its CEO total annual compensation worth €1.8m over the year to December 2024. That is, the compensation was roughly the same as last year. We note that the salary portion, which stands at €1.28m constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the the Netherlands Capital Markets industry with market capitalizations ranging from €1.8b to €5.7b, the reported median CEO total compensation was €2.2m. This suggests that Van Lanschot Kempen remunerates its CEO largely in line with the industry average. Furthermore, Maarten Edixhoven directly owns €5.0m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 36% of total compensation represents salary and 64% is other remuneration. Van Lanschot Kempen pays out 72% of remuneration in the form of a salary, significantly higher than the industry average. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Van Lanschot Kempen NV's Growth Numbers

Over the last three years, Van Lanschot Kempen NV has shrunk its earnings per share by 2.4% per year. It achieved revenue growth of 8.8% over the last year.

A lack of EPS improvement is not good to see. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. 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 Van Lanschot Kempen NV Been A Good Investment?

Boasting a total shareholder return of 205% over three years, Van Lanschot Kempen NV has done well by shareholders. 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.

To Conclude...

Although shareholders would be quite happy with the returns they have earned on their initial investment, earnings have failed to grow and this could mean returns may be hard to keep up. Shareholders should make the most of the coming opportunity to question the board on key concerns they may have and revisit their investment thesis with regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Van Lanschot Kempen that you should be aware of before investing.

Switching gears from Van Lanschot Kempen, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.