Dana Whitfield· Director, Global Compensation, Meridian Health Systems
Asked in Executive Compensation ·
CEO pay ratio jumped from 58:1 to 94:1 because of one vesting. How are you explaining yours?
UK listed food retailer with around 31,000 employees, most of them hourly paid in stores. Last year's ratio at the median was 58:1. This year it is 94:1 because the first long-term award under the current chief executive vested, and nothing vested the year before.
Store pay rose 6.1% in the same period, so the underlying story is reasonable, but the headline number will be picked up by the press and by the unions.
Do people show a second ratio excluding long-term awards, or does that look like hiding the real figure?
0 reactions · 2 replies · 4 views
Accepted answer· by Nadia Haddad
We show both and have done for four years without criticism. The required ratio comes first, on the total single figure, with no commentary softening it. Directly underneath is the ratio on salary, benefits and annual bonus only, and one paragraph saying the gap between the two is the long-term award, which covers three years of performance and vested this year for the first time. The order matters. Lead with the alternative figure and it looks like hiding. Lead with the required one and it reads as explanation.
Read in the conversation ↓
