Here's Why We Think ASSA ABLOY AB (publ)'s (STO:ASSA B) CEO Compensation Looks Fair for the time being

Key Insights

• ASSA ABLOY to hold its Annual General Meeting on 24th of April
• Salary of kr23.2m is part of CEO Nico Delvaux's total remuneration
• Total compensation is similar to the industry average
• ASSA ABLOY's total shareholder return over the past three years was 28% while its EPS grew by 14% over the past three years

CEO Nico Delvaux has done a decent job of delivering relatively good performance at ASSA ABLOY AB (publ) (STO:ASSA B) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 24th of April. Here is our take on why we think the CEO compensation looks appropriate.

View our latest analysis for ASSA ABLOY

Comparing ASSA ABLOY AB (publ)'s CEO Compensation With The Industry

At the time of writing, our data shows that ASSA ABLOY AB (publ) has a market capitalization of kr341b, and reported total annual CEO compensation of kr58m for the year to December 2023. We note that's an increase of 11% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at kr23m.

For comparison, other companies in the Swedish Building industry with market capitalizations above kr88b, reported a median total CEO compensation of kr49m. From this we gather that Nico Delvaux is paid around the median for CEOs in the industry. Furthermore, Nico Delvaux directly owns kr80m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	kr23m	kr21m	40%
Other	kr34m	kr30m	60%
Total Compensation	kr58m	kr52m	100%

Talking in terms of the industry, salary represented approximately 51% of total compensation out of all the companies we analyzed, while other remuneration made up 49% of the pie. In ASSA ABLOY's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at ASSA ABLOY AB (publ)'s Growth Numbers

ASSA ABLOY AB (publ) has seen its earnings per share (EPS) increase by 14% a year over the past three years. In the last year, its revenue is up 16%.

Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has ASSA ABLOY AB (publ) Been A Good Investment?

ASSA ABLOY AB (publ) has served shareholders reasonably well, with a total return of 28% over three years. 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...

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. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

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 ASSA ABLOY that you should be aware of before investing.

Switching gears from ASSA ABLOY, 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.