Koninklijke KPN N.V.'s (AMS:KPN) CEO Will Probably Have Their Compensation Approved By Shareholders

Key Insights

• Koninklijke KPN will host its Annual General Meeting on 17th of April
• Salary of €892.5k is part of CEO Joost F. Farwerck's total remuneration
• Total compensation is similar to the industry average
• Over the past three years, Koninklijke KPN's EPS grew by 16% and over the past three years, the total shareholder return was 39%

The performance at Koninklijke KPN N.V. (AMS:KPN) has been quite strong recently and CEO Joost F. Farwerck has played a role in it. Coming up to the next AGM on 17th of April, shareholders would be keeping this in mind. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.

View our latest analysis for Koninklijke KPN

How Does Total Compensation For Joost F. Farwerck Compare With Other Companies In The Industry?

According to our data, Koninklijke KPN N.V. has a market capitalization of €14b, and paid its CEO total annual compensation worth €3.0m over the year to December 2023. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €893k.

For comparison, other companies in the the Netherlands Telecom industry with market capitalizations above €7.4b, reported a median total CEO compensation of €2.9m. This suggests that Koninklijke KPN remunerates its CEO largely in line with the industry average. Moreover, Joost F. Farwerck also holds €5.3m worth of Koninklijke KPN stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	€893k	€879k	29%
Other	€2.1m	€2.1m	71%
Total Compensation	€3.0m	€3.0m	100%

On an industry level, roughly 59% of total compensation represents salary and 41% is other remuneration. It's interesting to note that Koninklijke KPN allocates a smaller portion of compensation to salary in comparison 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.

Koninklijke KPN N.V.'s Growth

Koninklijke KPN N.V. has seen its earnings per share (EPS) increase by 16% a year over the past three years. It achieved revenue growth of 2.4% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 Koninklijke KPN N.V. Been A Good Investment?

Boasting a total shareholder return of 39% over three years, Koninklijke KPN N.V. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 2 warning signs for Koninklijke KPN that investors should be aware of in a dynamic business environment.

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.