It Looks Like Shareholders Would Probably Approve Ralph Lauren Corporation's (NYSE:RL) CEO Compensation Package

Key Insights

• Ralph Lauren to hold its Annual General Meeting on 1st of August
• Total pay for CEO Patrice Jean Louvet includes US$1.35m salary
• The total compensation is similar to the average for the industry
• Ralph Lauren's EPS grew by 37% over the past three years while total shareholder return over the past three years was 60%

It would be hard to discount the role that CEO Patrice Jean Louvet has played in delivering the impressive results at Ralph Lauren Corporation (NYSE:RL) recently. Coming up to the next AGM on 1st of August, shareholders would be keeping this in mind. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.

See our latest analysis for Ralph Lauren

Comparing Ralph Lauren Corporation's CEO Compensation With The Industry

Our data indicates that Ralph Lauren Corporation has a market capitalization of US$10b, and total annual CEO compensation was reported as US$17m for the year to March 2024. That's a notable increase of 15% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.4m.

In comparison with other companies in the American Luxury industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$17m. This suggests that Ralph Lauren remunerates its CEO largely in line with the industry average. Moreover, Patrice Jean Louvet also holds US$4.0m worth of Ralph Lauren stock directly under their own name.

Component	2024	2023	Proportion (2024)
Salary	US$1.4m	US$1.4m	8%
Other	US$15m	US$13m	92%
Total Compensation	US$17m	US$14m	100%

Speaking on an industry level, nearly 22% of total compensation represents salary, while the remainder of 78% is other remuneration. In Ralph Lauren's case, non-salary compensation represents a greater slice of total remuneration, in comparison 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 Ralph Lauren Corporation's Growth Numbers

Ralph Lauren Corporation has seen its earnings per share (EPS) increase by 37% a year over the past three years. Its revenue is up 2.9% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. 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 Ralph Lauren Corporation Been A Good Investment?

Most shareholders would probably be pleased with Ralph Lauren Corporation for providing a total return of 60% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at 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.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 2 warning signs for Ralph Lauren 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com