Companies / 7 October 2019, 11:30am / Sandile Mchunu
DURBAN - Shoprite Holdings chief executive Pieter Engelbrecht’s total remuneration was R21.27million in 2019, up by 4.5percent compared with last year's R20.36m, according to the retailer's annual report released on Friday. The report strove to be more transparent following shareholders’ discontent over pay policies last year.
The total remuneration figure includes a short-term incentive of R4.44m, R214000 in benefits and other benefits of R491000.
Engelbrecht’s annual salary increase to R16.13m rose by 7.5percent compared with the R15.01m he earned in 2018.
Shoprite’s chief financial officer, Anton de Bruyn, received total remuneration of R6.74m, up by 31percent compared with R5.15m he received in 2018. His annual salary of R3.12m was up by 27.7percent compared with last year's salary of R2.45m.
The remuneration package of the group's divisional manager, Ram Harisunker, declined by 3.9percent to R5.72m, compared with R5.96m last year. The biggest reason for the decline was a 13.2percent decline in his short-term incentives, which fell to R1.4m in 2019 compared with R1.62m in 2018.
However, his annual salary rose by 6.8percent to R3.79m.
Shoprite said in the annual report that, over the next three years, the retailer would complete and implement its revised remuneration policy.
“In 2020, we will roll out the first phase, which affects 2257 people in our executive, senior and middle management teams. For 2020, we will revise the performance criteria and adjust the designs relating to long- and short-term incentives.
"These changes will first affect executives and senior management, before being rolled out to additional eligible employees in 2021,” it said.
Professor Shirley Zinn, chairperson of the group's remuneration committee, said following the 2018 annual general meeting, where more than 25percent of ordinary shareholders voted against the remuneration policy, the committee, together with executives and the company secretary, led shareholder engagement to understand their concerns.
“During 2019, the committee, the human resources department, the board and executives begun overhauling the remuneration strategy to align more closely with the group's strategy and address the concerns raised,” Zinn said. De Bruyn said Shoprite increased its turnover by 3.6percent to R150.4billion for the year to the end of June.
“Emerging from a transformational year in 2018, which resulted in only marginal sales growth in the first half to December, the group managed to report improved growth in the second half of the financial year. This performance was driven mainly by our Supermarkets RSA operation growing sales by 7.4percent in the six months to June 2019 and 9.4percent in the final quarter. The market-share gains reflected in the most recent quarter testify to our core South African business being back to full operational strength,” De Bruyn said.
Shoprite highlighted shareholder discontent this year with its hotly contested plan to buy back deferred shares in Thibault Square Financial Services Proprietary, chairperson Christo Wiese’s investment vehicle to simplify its voting structure.
Shoprite will hold its annual general meeting on November 4.