We Think Shareholders Will Probably Be Generous With Occidental Petroleum Corporation's (NYSE:OXY) CEO Compensation

Key Insights

• Occidental Petroleum to hold its Annual General Meeting on 2nd of May
• Salary of US$1.47m is part of CEO Vicki Hollub's total remuneration
• The overall pay is comparable to the industry average
• Occidental Petroleum's EPS grew by 85% over the past three years while total shareholder return over the past three years was 168%

The performance at Occidental Petroleum Corporation (NYSE:OXY) has been quite strong recently and CEO Vicki Hollub has played a role in it. Coming up to the next AGM on 2nd of May, 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. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Occidental Petroleum

Comparing Occidental Petroleum Corporation's CEO Compensation With The Industry

Our data indicates that Occidental Petroleum Corporation has a market capitalization of US$60b, and total annual CEO compensation was reported as US$18m for the year to December 2023. We note that's an increase of 18% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.5m.

In comparison with other companies in the American Oil and Gas industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$15m. From this we gather that Vicki Hollub is paid around the median for CEOs in the industry. What's more, Vicki Hollub holds US$48m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	US$1.5m	US$1.3m	8%
Other	US$16m	US$14m	92%
Total Compensation	US$18m	US$15m	100%

On an industry level, around 13% of total compensation represents salary and 87% is other remuneration. It's interesting to note that Occidental Petroleum allocates a smaller portion of compensation to salary 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.

Occidental Petroleum Corporation's Growth

Over the past three years, Occidental Petroleum Corporation has seen its earnings per share (EPS) grow by 85% per year. In the last year, its revenue is down 23%.

This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. 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 Occidental Petroleum Corporation Been A Good Investment?

Boasting a total shareholder return of 168% over three years, Occidental Petroleum Corporation has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in 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 it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 2 warning signs for Occidental Petroleum that investors should look into moving forward.

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.