Shareholders Would Not Be Objecting To Wolters Kluwer N.V.'s (AMS:WKL) CEO Compensation And Here's Why

Key Insights

• Wolters Kluwer will host its Annual General Meeting on 8th of May

• CEO Nancy McKinstry's total compensation includes salary of €1.50m

• The total compensation is similar to the average for the industry

• Wolters Kluwer's total shareholder return over the past three years was 87% while its EPS grew by 16% over the past three years

It would be hard to discount the role that CEO Nancy McKinstry has played in delivering the impressive results at Wolters Kluwer N.V. (AMS:WKL) recently. Shareholders will have this at the front of their minds in the upcoming AGM on 8th of May. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

See our latest analysis for Wolters Kluwer

Comparing Wolters Kluwer N.V.'s CEO Compensation With The Industry

Our data indicates that Wolters Kluwer N.V. has a market capitalization of €34b, and total annual CEO compensation was reported as €8.4m for the year to December 2023. That's just a smallish increase of 6.0% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at €1.5m.

In comparison with other companies in the Dutch Professional Services industry with market capitalizations over €7.5b, the reported median total CEO compensation was €7.2m. So it looks like Wolters Kluwer compensates Nancy McKinstry in line with the median for the industry. Furthermore, Nancy McKinstry directly owns €9.3m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 49% of total compensation represents salary and 51% is other remuneration. Wolters Kluwer 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.

A Look at Wolters Kluwer N.V.'s Growth Numbers

Over the past three years, Wolters Kluwer N.V. has seen its earnings per share (EPS) grow by 16% per year. It achieved revenue growth of 2.4% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. 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 Wolters Kluwer N.V. Been A Good Investment?

Boasting a total shareholder return of 87% over three years, Wolters Kluwer N.V. 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...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

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 1 warning sign for Wolters Kluwer that investors should think about before committing capital to this stock.

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.