Shareholders May Find It Hard To Justify A Pay Rise For Celanese Corporation's (NYSE:CE) CEO This Year

Key Insights

• Celanese's Annual General Meeting to take place on 13th of May
• Total pay for CEO Lori Ryerkerk includes US$1.29m salary
• The total compensation is similar to the average for the industry
• Over the past three years, Celanese's EPS grew by 1.4% and over the past three years, the total shareholder return was 1.5%

Performance at Celanese Corporation (NYSE:CE) has been reasonably good and CEO Lori Ryerkerk has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 13th of May. Here is our take on why we think the CEO compensation looks appropriate.

See our latest analysis for Celanese

Comparing Celanese Corporation's CEO Compensation With The Industry

According to our data, Celanese Corporation has a market capitalization of US$18b, and paid its CEO total annual compensation worth US$13m over the year to December 2023. Notably, that's an increase of 18% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.3m.

On comparing similar companies in the American Chemicals industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$14m. So it looks like Celanese compensates Lori Ryerkerk in line with the median for the industry. Furthermore, Lori Ryerkerk directly owns US$24m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	US$1.3m	US$1.3m	10%
Other	US$12m	US$9.7m	90%
Total Compensation	US$13m	US$11m	100%

On an industry level, around 19% of total compensation represents salary and 81% is other remuneration. Celanese pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Celanese Corporation's Growth

Celanese Corporation has seen its earnings per share (EPS) increase by 1.4% a year over the past three years. It achieved revenue growth of 13% over the last year.

This revenue growth could really point to a brighter future. And the improvement in EPSis modest but respectable. Although we'll stop short of calling the stock a top performer, we think the company has potential. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Celanese Corporation Been A Good Investment?

With a total shareholder return of 1.5% over three years, Celanese Corporation has done okay by shareholders, but there's always room for improvement. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.

In Summary...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 3 warning signs for Celanese you should be aware of, and 2 of them are potentially serious.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.