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Hell to pay: What’s a couple of bar between bosses?



Hell to pay: What’s a couple of bar between bosses?

Mining claims to be struggling to cover its costs, but it’s rather generous with payments to execs

Giulietta Talevi

For an industry that claims to be struggling to cover its costs, mining does seem to be remarkably generous with its payments to corporate executives.
According to PwC’s recently released report on South African executive remuneration trends, mining companies hiked their CEOs’ total guaranteed pay by between 4.3% and 13% in 2017. It has to be noted that the PwC report covers all mining companies, which includes the gold miners.The rate of executive pay increase in the industry depended on the size of the company, with the large-cap miners giving median increases of 4.3% to R31.2-million. Medium-cap companies awarded their CEOs median increases of 7.2%, taking the average up to R10.3-million. The CEOs of small-cap mining companies enjoyed the highest median increases at 13% for an average payout of R3.6-million.
Other top executives in the mining companies also enjoyed generous increases in their total guaranteed pay.
The PwC report doesn’t provide a breakdown of the short-term bonuses that are guaranteed to bump up executive pay each year, but the overall picture is heartening for the pampered executives.
On top of all this, executives can look forward to generous payouts from their long-term incentive schemes. PwC provides no details on long-term incentives, which are so shockingly complicated they defy comparison, but a rule of thumb is that they add about 30% to the value of an executive’s remuneration.
So when it comes to executive pay there’s certainly no sign of difficult times in the mining industry. Of course it could be that gold miners are horrendously out of step and their very survival is at stake. Or talk of widespread losses could just be self-serving fear tactics ahead of wage negotiations.

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