We Think Some Shareholders May Hesitate To Increase Fonterra Co-operative Group Limited's (NZSE:FCG) CEO Compensation

Key Insights

• Fonterra Co-operative Group will host its Annual General Meeting on 11th of December
• CEO Miles Hurrell's total compensation includes salary of NZ$2.49m
• Total compensation is 62% above industry average
• Fonterra Co-operative Group's EPS grew by 18% over the past three years while total shareholder return over the past three years was 268%

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Under the guidance of CEO Miles Hurrell, Fonterra Co-operative Group Limited (NZSE:FCG) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 11th of December. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Fonterra Co-operative Group

How Does Total Compensation For Miles Hurrell Compare With Other Companies In The Industry?

Our data indicates that Fonterra Co-operative Group Limited has a market capitalization of NZ$9.4b, and total annual CEO compensation was reported as NZ$6.1m for the year to July 2025. That's a modest increase of 3.1% on the prior year. We think total compensation is more important but our data shows that the CEO salary is lower, at NZ$2.5m.

For comparison, other companies in the New Zealander Food industry with market capitalizations ranging between NZ$6.9b and NZ$21b had a median total CEO compensation of NZ$3.8m. Accordingly, our analysis reveals that Fonterra Co-operative Group Limited pays Miles Hurrell north of the industry median.

On an industry level, roughly 54% of total compensation represents salary and 46% is other remuneration. Fonterra Co-operative Group pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Fonterra Co-operative Group Limited's Growth Numbers

Over the past three years, Fonterra Co-operative Group Limited has seen its earnings per share (EPS) grow by 18% per year. In the last year, its revenue is up 18%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Fonterra Co-operative Group Limited Been A Good Investment?

We think that the total shareholder return of 268%, over three years, would leave most Fonterra Co-operative Group Limited shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Fonterra Co-operative Group that you should be aware of before investing.

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.