Johannesburg - Shoprite doubled Chief Executive Officer Whitey Basson’s pay last fiscal year to R100.1 million ($7.4 million), thanks to a bonus from Africa’s largest food retailer for beating a profit-growth target.
Basson’s remuneration included R49.7 million in basic pay for the 12 months through June, in line with the previous year, and a R50 million one-time performance-related bonus, the Cape Town-based company said in its annual report. Trading profit growth of 15 percent beat an internal target of 11 percent, the retailer said.
Dave Lewis, the CEO of Tesco, the UK’s biggest supermarket chain, got 4.63 million pounds ($5.96 million) in fiscal 2016. Iain Moir, the CEO of South African food and clothes retailer Woolworths, was paid R53.7 million in the year ended June 26, including base salary of R16.4 million and a performance-related bonus of R15 million.
The decision comes less than a year after the South African government-owned Public Investment Corporation voted against the company’s remuneration policy because the R50.1 million pay awarded to Basson was mostly a fixed payment, rather than a performance-based salary. The Pretoria-based PIC owns almost 10 percent of Shoprite, according to data compiled by Bloomberg. The money manager couldn’t immediately comment on the 2016 pay.
Other reasons given by Shoprite for the bonus include that Basson hasn’t received a basic pay increase since 2013 and no one-time payments for five fiscal years, according to the report. The retailer also cited the CEO’s length of service at the company. The 70-year-old has worked at Shoprite for 45 years and has been at the helm since 1979.
“Recently in South Africa it has become a trend for retailers to recruit their CEOs from multinational retailers outside” the country, Shoprite said. “The war for talent in this space is not confined to the African continent.”
Shoprite shares gained 1.5 percent to R194.18 as of 3.01pm in Johannesburg on Monday, valuing the retailer at R112 billion. The stock fell 4.1 percent during the year through June, compared with a 1.9 percent gain on the FTSE/JSE Africa Food & Drug Retailers Index.
* With assistance from Sam Chambers
BLOOMBERG