Simon Swanson has been the CEO of ClearView Wealth Limited (ASX:CVW) since 2010. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for ClearView Wealth

How Does Simon Swanson's Compensation Compare With Similar Sized Companies?

According to our data, ClearView Wealth Limited has a market capitalization of AU$225m, and paid its CEO total annual compensation worth AU$1.8m over the year to June 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at AU$695k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We took a group of companies with market capitalizations below AU$303m, and calculated the median CEO total compensation to be AU$380k.

Thus we can conclude that Simon Swanson receives more in total compensation than the median of a group of companies in the same market, and of similar size to ClearView Wealth Limited. However, this doesn't necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see a visual representation of the CEO compensation at ClearView Wealth, below.

Is ClearView Wealth Limited Growing?

Over the last three years ClearView Wealth Limited has shrunk its earnings per share by an average of 29% per year (measured with a line of best fit). It achieved revenue growth of 57% over the last year.

Investors should note that, over three years, earnings per share are down. On the other hand, the strong revenue growth suggests the business is growing. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has ClearView Wealth Limited Been A Good Investment?

Given the total loss of 72% over three years, many shareholders in ClearView Wealth Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

We compared total CEO remuneration at ClearView Wealth Limited with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.

While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Shareholders may wish to consider further research. Although we don't think the CEO pay is too high, it is probably more on the generous side of things. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling ClearView Wealth (free visualization of insider trades).

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

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