Why We Think Crawford & Company's (NYSE:CRD.B) CEO Compensation Is Not Excessive At All

Key Insights

• Crawford's Annual General Meeting to take place on 8th of May
• Salary of US$803.3k is part of CEO Rohit Verma's total remuneration
• Total compensation is similar to the industry average
• Over the past three years, Crawford's EPS fell by 2.4% and over the past three years, the total shareholder return was 58%

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The share price of Crawford & Company (NYSE:CRD.B) has increased significantly over the past few years. However, the earnings growth has not kept up with the share price momentum, suggesting that some other factors may be driving the price direction. The upcoming AGM on 8th of May may be an opportunity for shareholders to bring up any concerns they may have for the board’s attention. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. From what we gathered, we think shareholders should be wary of raising CEO compensation until the company shows some marked improvement.

See our latest analysis for Crawford

Comparing Crawford & Company's CEO Compensation With The Industry

According to our data, Crawford & Company has a market capitalization of US$540m, and paid its CEO total annual compensation worth US$2.2m over the year to December 2024. That's a notable decrease of 8.1% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$803k.

In comparison with other companies in the American Insurance industry with market capitalizations ranging from US$200m to US$800m, the reported median CEO total compensation was US$2.5m. From this we gather that Rohit Verma is paid around the median for CEOs in the industry. What's more, Rohit Verma holds US$3.5m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	US$803k	US$716k	37%
Other	US$1.4m	US$1.6m	63%
Total Compensation	US$2.2m	US$2.4m	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. According to our research, Crawford has allocated a higher percentage of pay to salary in comparison to the wider industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Crawford & Company's Growth

Over the last three years, Crawford & Company has shrunk its earnings per share by 2.4% per year. Its revenue is up 2.0% over the last year.

The lack of EPS growth is certainly uninspiring. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Crawford & Company Been A Good Investment?

Boasting a total shareholder return of 58% over three years, Crawford & Company 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...

Although shareholders would be quite happy with the returns they have earned on their initial investment, earnings have failed to grow and this could mean returns may be hard to keep up. Shareholders should make the most of the coming opportunity to question the board on key concerns they may have and revisit their investment thesis with regards to the company.

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 2 warning signs for Crawford 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.

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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.