We Think Some Shareholders May Hesitate To Increase Chubb Limited's (NYSE:CB) CEO Compensation

Key Insights

• Chubb's Annual General Meeting to take place on 16th of May
• Salary of US$1.55m is part of CEO Evan Greenberg's total remuneration
• The total compensation is 96% higher than the average for the industry
• Over the past three years, Chubb's EPS grew by 23% and over the past three years, the total shareholder return was 58%

Performance at Chubb Limited (NYSE:CB) has been reasonably good and CEO Evan Greenberg has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 16th of May. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Chubb

How Does Total Compensation For Evan Greenberg Compare With Other Companies In The Industry?

Our data indicates that Chubb Limited has a market capitalization of US$102b, and total annual CEO compensation was reported as US$28m for the year to December 2023. That's a notable increase of 10.0% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.6m.

In comparison with other companies in the American Insurance industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$14m. This suggests that Evan Greenberg is paid more than the median for the industry. What's more, Evan Greenberg holds US$180m 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$1.6m	US$1.4m	6%
Other	US$26m	US$24m	94%
Total Compensation	US$28m	US$25m	100%

Talking in terms of the industry, salary represented approximately 14% of total compensation out of all the companies we analyzed, while other remuneration made up 86% of the pie. Chubb pays a modest slice of remuneration through salary, as compared 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.

Chubb Limited's Growth

Chubb Limited's earnings per share (EPS) grew 23% per year over the last three years. It achieved revenue growth of 17% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. 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 Chubb Limited Been A Good Investment?

Boasting a total shareholder return of 58% over three years, Chubb Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

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 1 warning sign for Chubb 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.