This Is Why We Think Borregaard ASA's (OB:BRG) CEO Might Get A Pay Rise Approved By Shareholders

Key Insights

• Borregaard to hold its Annual General Meeting on 11th of April
• Salary of kr4.12m is part of CEO Per Sørlie's total remuneration
• The total compensation is 48% less than the average for the industry
• Over the past three years, Borregaard's EPS grew by 26% and over the past three years, the total shareholder return was 12%

Shareholders will be pleased by the robust performance of Borregaard ASA (OB:BRG) recently and this will be kept in mind in the upcoming AGM on 11th of April. The focus will probably be on the future strategic initiatives that the board and management will put in place to improve the business rather than executive remuneration when they cast their votes on company resolutions. In our analysis below, we discuss why we think the CEO compensation looks acceptable and the case for a raise.

Check out our latest analysis for Borregaard

How Does Total Compensation For Per Sørlie Compare With Other Companies In The Industry?

According to our data, Borregaard ASA has a market capitalization of kr19b, and paid its CEO total annual compensation worth kr9.5m over the year to December 2023. We note that's an increase of 13% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at kr4.1m.

On comparing similar companies from the Norwegian Chemicals industry with market caps ranging from kr11b to kr34b, we found that the median CEO total compensation was kr18m. This suggests that Per Sørlie is paid below the industry median. Furthermore, Per Sørlie directly owns kr32m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	kr4.1m	kr3.9m	43%
Other	kr5.4m	kr4.5m	57%
Total Compensation	kr9.5m	kr8.5m	100%

Speaking on an industry level, nearly 45% of total compensation represents salary, while the remainder of 55% is other remuneration. Borregaard is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Borregaard ASA's Growth

Borregaard ASA's earnings per share (EPS) grew 26% per year over the last three years. Its revenue is up 3.6% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Borregaard ASA Been A Good Investment?

Borregaard ASA has generated a total shareholder return of 12% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

While the company seems to be headed in the right direction performance-wise, there's always room for 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.

If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Borregaard.

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.