Between 2019 and 2020: Understanding The New Realities of CEO Remuneration

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Saturday, August 01, 2020 / 07:00 AM / By Proshare Research / Header Image Credit: EcoGraphics

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In 2019 CEOs where beginning to gain confidence in the economy as gross domestic product grew steadily out of the negative growth rates between 2016 and 2017, as recession blues passed away. The C-suite in 2018 had become a few notches more optimistic and corporate chief executives (CEOs) had started to see their remunerations climb. The trend continued in 2019 as the economy showed signs of sustained growth with analysts predicting growth rates of between 2.5 and 3% ( GDP actually closed the year at 2.55%).


The year 2019 promised a strong 2020 as the Central Bank of Nigeria's (CBN's) manufacturing sector purchasing managers index (PMI) stood at 60.8, indicating expansion in the manufacturing sector for the thirty-third consecutive month. In 2020 the story has flipped with the PMI for July 2020 slumping to 44.9 indicating manufacturing sector contraction, a worsening of CEO headaches.

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The 2nd edition of Proshare's CEO Remuneration report titled "CEO Remuneration: Paying the CEO in a Pandemic the Unanswered Question" provided fresh insights as regards CEO remuneration and the various dynamics and complexities associated with CEO pay in 2019 and the likely worsening shape of things in 2020. The following fresh insights were deduced from the report:


  • In the inaugural edition, there were no major shakeups in the economy like the coronavirus. The 2nd edition of the CEO remuneration report addressed in detail the possible impact of the coronavirus on the remuneration of various companies in various sectors in 2020.
  • The new report laid emphasis on theories surrounding the various motives for compensating CEOs which was classified into three main approaches namely the value approach, symbolic approach, and the agency approach. Also, Behavioural economist Dan Ariely's theory was discussed to understand if the executive's productivity would increase if their bonuses rose.
  • The second  report addressed executive remuneration around the globe, about what characterizes executive remuneration in different regions and the key challenges facing companies as they seek to improve the link between pay and performances.
  • Unlike the 1st edition of the CEO remuneration report in which only two metrics which are revenue and profit were used, the 2nd edition expanded the metrics to include dividend's paid, earnings per share and dividend payout ratio to understand if there is a nexus between CEOs pay and shareholders value creation.
  • New findings emerged that not all CEOs who received high remuneration were able to increase shareholder's value which reveals that other factors determine CEOs' pay, hence the need for further studies.

As at the time of publishing the second report no CEO had yet responded to Proshares enquiries concerning other aspects of their total compensation including bonuses and dividends. It is hoped that by the next edition of the report in 2021, it would be possible to gather more detailed information on how much Nigerian CEOs receive annually. 


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Downloadable Versions of 2020 Report (PDF)

1.      Executive Summary: CEO Remuneration 2020 Report - Paying the CEO in a Pandemic; The Unanswered Questions  July 30, 2020

2.      Full Report: CEO Remuneration 2020 Report - Paying the CEO in a Pandemic; The Unanswered Questions  July 30, 2020


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Previous Year's Report and Links

1.          CEO Remuneration 2019 Report: Making Sense of the Numbers for Listed Companies in Nigeria  July 30, 2019

2.          Full Report: CEO Remuneration 2019 Report - Making Sense of the Numbers for Listed Companies in Nigeria   July 30, 2019

3.          All Quoted Companies IR Pages - Proshare MARKETS



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Related News from CEO Remuneration 2020 Report

  1. CEO Remuneration 2020 Report - Paying the CEO in a Pandemic; The Unanswered Questions

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