Shareholders May Be Wary Of Increasing Truist Financial Corporation's (NYSE:TFC) CEO Compensation Package

Key Insights

• Truist Financial to hold its Annual General Meeting on 23rd of April
• Total pay for CEO Bill Rogers includes US$1.20m salary
• Total compensation is similar to the industry average
• Truist Financial's three-year loss to shareholders was 26% while its EPS was down 11% over the past three years

Truist Financial Corporation (NYSE:TFC) has not performed well recently and CEO Bill Rogers will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 23rd of April. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.

See our latest analysis for Truist Financial

How Does Total Compensation For Bill Rogers Compare With Other Companies In The Industry?

Our data indicates that Truist Financial Corporation has a market capitalization of US$49b, and total annual CEO compensation was reported as US$12m for the year to December 2023. Notably, that's a decrease of 9.1% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.2m.

In comparison with other companies in the American Banks industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$11m. So it looks like Truist Financial compensates Bill Rogers in line with the median for the industry. Moreover, Bill Rogers also holds US$41m worth of Truist Financial 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	US$1.2m	US$1.2m	10%
Other	US$11m	US$12m	90%
Total Compensation	US$12m	US$13m	100%

On an industry level, roughly 45% of total compensation represents salary and 55% is other remuneration. Truist Financial sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Truist Financial Corporation's Growth

Truist Financial Corporation has reduced its earnings per share by 11% a year over the last three years. Its revenue is down 4.4% over the previous year.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Truist Financial Corporation Been A Good Investment?

With a three year total loss of 26% for the shareholders, Truist Financial Corporation would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

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 Truist Financial that investors should think about before committing capital to this stock.

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.