Australian CEOs more likely to lose their jobs than their bonuses: ACSI report

Chief executives in Australia are more likely to lose their jobs than lose their bonus, according to a new report from the Australia Council of Superannuation Investors (ACSI).

ACSI's CEO Pay in ASX200 Companies report revealed that only two ASX100 chief executives and six ASX101-200 CEOs did not get a bonus for financial year 2023.

On the other hand, there were 24 termination payments across the full ASX200 sample in FY23.

"Once again, a CEO has more chance of being terminated than missing out on a bonus," the report read.

The median CEO bonus was also at least 60% for ASX100 CEOs (66.3%) and ASX101-200 CEOs (60.7%).

According to the ACSI, the median bonus for ASX100 CEOs also remained at least 60% of maximum for every year over the past nine years that the council collected CEO bonus outcomes.

Ed John, Executive Manager, Stewardship at ACSI, has expressed concerns over the bonuses handed out to CEOs.

"Bonuses should not become a given in Australian companies. At a time when companies are focused on productivity and performance, it is critical that bonuses are only paid for exceptional outcomes," John said in a statement.

CEO pay levels dip

These bonuses come as CEO pay levels declined in the previous financial year, according to the report.

Realised pay for ASX100 CEOs fell with the median dropping to a decade-low of $3.87 million, down from the $3.93 million a year ago. Reported pay levels for ASX 200 CEOs, however, edged up in the year, according to the report.

The median pay levels for ASX100 CEOs topped $5 million for the first time in FY23, while ASX101-200 median pay was near record levels of $2.25 million.

According to the report, the higher reported pay levels for ASX 200 CEOs is "normally a precursor for much higher realised pay outcomes in the future."

"While overall pay levels have dropped, investors and boards must not become complacent. The numbers show that we could see a breakout in CEO pay levels in future. It will be critical that boards pay close attention and ensure performance hurdles are set at the right levels," John said.

Who are the highest-paid CEOs?

Meanwhile, the report revealed that ResMed CEO Mick Farrell is the highest-paid CEO in Australia with a realised pay of $47,578,556.

Coming in second is News Corporation CEO Robert Thomson with a realised pay of $41,527,709.

Source: ACSI's CEO Pay in ASX200 Companies

Goodman Group CEO Greg Goodman placed third but remained the highest-paid domestic CEO with a realised pay of $27,334,826.