Here's Why Dominion Energy, Inc.'s (NYSE:D) CEO Compensation Is The Least Of Shareholders Concerns

Key Insights

• Dominion Energy's Annual General Meeting to take place on 7th of May
• CEO Bob Blue's total compensation includes salary of US$1.23m
• The overall pay is 35% below the industry average
• Dominion Energy's three-year loss to shareholders was 27% while its EPS grew by 13% over the past three years

Shareholders may be wondering what CEO Bob Blue plans to do to improve the less than great performance at Dominion Energy, Inc. (NYSE:D) recently. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 7th of May. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. We think CEO compensation looks appropriate given the data we have put together.

View our latest analysis for Dominion Energy

How Does Total Compensation For Bob Blue Compare With Other Companies In The Industry?

According to our data, Dominion Energy, Inc. has a market capitalization of US$43b, and paid its CEO total annual compensation worth US$6.3m over the year to December 2023. That's a slight decrease of 7.6% on the prior year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.2m.

On comparing similar companies in the American Integrated Utilities industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$9.6m. In other words, Dominion Energy pays its CEO lower than the industry median. What's more, Bob Blue holds US$9.2m 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$1.2m	US$1.2m	20%
Other	US$5.1m	US$5.6m	80%
Total Compensation	US$6.3m	US$6.8m	100%

On an industry level, around 13% of total compensation represents salary and 87% is other remuneration. According to our research, Dominion Energy has allocated a higher percentage of pay to salary in comparison to the wider industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Dominion Energy, Inc.'s Growth Numbers

Dominion Energy, Inc.'s earnings per share (EPS) grew 13% per year over the last three years. Its revenue is up 3.3% 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. 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 Dominion Energy, Inc. Been A Good Investment?

Since shareholders would have lost about 27% over three years, some Dominion Energy, Inc. investors would surely be feeling negative emotions. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

The fact that shareholders are sitting on a loss is certainly disheartening. The share price trend has diverged with the robust growth in EPS however, suggesting there may be other factors that could be driving the price performance. A key focus for the board and management will be how to align the share price with fundamentals. In the upcoming AGM, shareholders will get the opportunity to discuss these concerns with the board and assess if the board's plan is likely to improve company performance.

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 Dominion Energy that investors should look into moving forward.

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.