How Much is EVE Investments Limited’s (ASX:EVE) CEO Getting Paid?

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Is EVE overpaying the CEO?

Even though no standard benchmark exists, as remuneration should account for specific factors of the company and market, we can fashion a high-level base line to see if EVE is an outlier. This exercise can help shareholders ask the right question about Cooke’s incentive alignment. On average, an Australian small-cap is worth around $140M, creates earnings of $10M, and remunerates its CEO circa $500,000 annually. Usually I would use earnings and market cap to account for variations in performance, however, EVE’s negative earnings reduces the usefulness of my formula. Looking at the range of compensation for small-cap executives, it seems like Cooke is paid aptly compared to those in similar-sized companies. Overall, though EVE is loss-making, it seems like the CEO’s pay is fair.

Next Steps:

Hopefully this article has given you insight on how shareholders should think about EVE’s governance policies such as CEO pay. As an investor, you have the right to understand how the board thinks about management incentives, and also the right to vote for and against substantial CEO pay changes. Governance is a big factor in investing, and I encourage you to dig deeper into those that represent your voice on the board. If you have not done so already, I urge you to complete your research by taking a look at the following:

1. Governance: To find out more about EVE’s governance, look through our infographic report of the company’s board and management.
2. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of EVE? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.