Key Insights

• Crawford will host its Annual General Meeting on 10th of May
• Total pay for CEO Rohit Verma includes US$716.3k salary
• The overall pay is comparable to the industry average
• Over the past three years, Crawford's EPS fell by 19% and over the past three years, the total shareholder return was 8.8%

The share price of Crawford & Company (NYSE:CRD.B) has been growing in the past few years, however, the per-share earnings growth has been lacking, suggesting something is amiss. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 10th of May. They will be able to influence managerial decisions through the exercise of their voting power on resolutions, such as CEO remuneration and other matters, which may influence future company prospects. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

Comparing Crawford & Company's CEO Compensation With The Industry

Our data indicates that Crawford & Company has a market capitalization of US$482m, and total annual CEO compensation was reported as US$2.4m for the year to December 2023. We note that's an increase of 21% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$716k.

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$2.6m. This suggests that Crawford remunerates its CEO largely in line with the industry average. Furthermore, Rohit Verma directly owns US$2.6m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 14% of total compensation represents salary and 86% is other remuneration. It's interesting to note that Crawford pays out a greater portion of remuneration through salary, compared to the 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 Crawford & Company's Growth Numbers

Over the last three years, Crawford & Company has shrunk its earnings per share by 19% per year. In the last year, its revenue is up 2.1%.

The decline in EPS is a bit concerning. The fairly low revenue growth fails to impress given that the EPS is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Crawford & Company Been A Good Investment?

Crawford & Company has not done too badly by shareholders, with a total return of 8.8%, over three years. It would be nice to see that metric improve in the future. Accordingly, a proposal to increase CEO remuneration without seeing an improvement in shareholder returns might not be met favorably by most shareholders.

In Summary...

Shareholder returns, while positive, should be looked at along with earnings, which have not grown at all recently. This makes us think the share price momentum may slow in the future. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 2 warning signs for Crawford that investors should be aware of in a dynamic business environment.

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.