It's Unlikely That Chubb Limited's (NYSE:CB) CEO Will See A Huge Pay Rise This Year
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
Total compensation is 96% above industry average
Over the past three years, Chubb's EPS grew by 23% and over the past three years, the total shareholder return was 58%
CEO Evan Greenberg has done a decent job of delivering relatively good performance at Chubb Limited (NYSE:CB) recently. As shareholders go into the upcoming AGM on 16th of May, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.
Check out 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.
For comparison, other companies in the American Insurance industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$14m. Hence, we can conclude that Evan Greenberg is remunerated higher than the industry median. 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% |
Speaking on an industry level, nearly 14% of total compensation represents salary, while the remainder of 86% is other remuneration. It's interesting to note that Chubb allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Chubb Limited's Growth Numbers
Over the past three years, Chubb Limited has seen its earnings per share (EPS) grow by 23% per year. In the last year, its revenue is up 17%.
This demonstrates that the company has been improving recently and is good news for the shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Chubb Limited Been A Good Investment?
Boasting a total shareholder return of 58% over three years, Chubb Limited has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
To Conclude...
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. 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 CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Chubb that investors should think about before committing capital to this stock.
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.
