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Here's Why Shareholders May Want To Be Cautious With Increasing Australia and New Zealand Banking Group Limited's (ASX:ANZ) CEO Pay Packet

Performance at Australia and New Zealand Banking Group Limited (ASX:ANZ) has been reasonably good and CEO Shayne Elliott 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 14 December 2022. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Australia and New Zealand Banking Group

Comparing Australia and New Zealand Banking Group Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Australia and New Zealand Banking Group Limited has a market capitalization of AU$72b, and reported total annual CEO compensation of AU$5.5m for the year to September 2022. That's mostly flat as compared to the prior year's compensation. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at AU$2.5m.

In comparison with other companies in the industry with market capitalizations over AU$12b, the reported median total CEO compensation was AU$4.1m. Hence, we can conclude that Shayne Elliott is remunerated higher than the industry median. What's more, Shayne Elliott holds AU$13m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2022

2021

Proportion (2022)

Salary

AU$2.5m

AU$2.5m

45%

Other

AU$3.0m

AU$3.0m

55%

Total Compensation

AU$5.5m

AU$5.5m

100%

Speaking on an industry level, nearly 48% of total compensation represents salary, while the remainder of 52% is other remuneration. There isn't a significant difference between Australia and New Zealand Banking Group and the broader market, in terms of salary allocation in the overall compensation package. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

ceo-compensation
ceo-compensation

Australia and New Zealand Banking Group Limited's Growth

Australia and New Zealand Banking Group Limited's earnings per share (EPS) grew 2.4% per year over the last three years. It achieved revenue growth of 9.3% over the last year.

We would argue that the improvement in revenue is good, but isn't particularly impressive, but we're happy with the modest EPS growth. Considering these factors we'd say performance has been pretty decent, though not amazing. 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 Australia and New Zealand Banking Group Limited Been A Good Investment?

Australia and New Zealand Banking Group Limited has generated a total shareholder return of 15% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this 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 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 2 warning signs for Australia and New Zealand Banking Group 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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