It says Telecom defends outrageous executive salaries.
Cactus Kate has another view.
The NBR looks at how Paul Reyonold’s pay stacks up against the competition.
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A rural perspective with a blue tint by Ele Ludemann
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As the NBR story says, Reynolds does much better than his counterpart at Fonterra – which is a much larger business.
Telstra is good point of reference. The Australian market is about five times the size of New Zealand. It’s far more competitive than here.
The previous CEO Sol Trujillo took home a whopping $13.4 million in his last year with the company. But that caused storms of protests in Australia.
His replacement has a base salary of $2 million, but according to press reports might get as much as $7 million with bonuses etc*. At current rates of exchange that’s around NZ$8 million or 60 percent more than Reynolds to run a much larger company.
I’d say Dr Reynolds is on to a good thing. Mind you, if the company makes a profit and improves services, it could be money well spent.
* I tried to check this figure, but can’t find a reference, so my leaky old memory will have to do.
I would have thought you’d pay him on the basis that he does a good job and achieves results. So far I reckon he has earned maybe $100 or so. CEO’s are grossly overpaid for the benefit they add, simple exploitation of shareholders foolish enough to go along with the theory that any CEO is worth a large salary.
What has comparisons with other companies got to do with it ? If he’s good, let him go there and persuade them. About the only CEO who made a difference of late in NZ was Ralph Waters, but anyone picking up the absolute heap of cr** that Fletcher left behind almost had to be able to improve just by acting sensibly.