Rowan Callaghan
Directors at South African Breweries (SAB) and Rainbow Chicken Limited this year lead the pack in awarding themselves increases, a survey of 26 companies by Business Mail shows.
A study of the annual reports of the companies — all in the top 150 and all with financial years ending in February and March — showed that 17 boards awarded themselves higher emoluments for 1995.
Executives of seven companies, at first glance, seemed to have taken cuts, but closer examination showed that the bill for executive directors was, in most cases, smaller because there were fewer positions being paid
Amalgamated Banks of South Africa (Absa) cut the number of its executive directors. But Foschini, an exception, decreased its spending on emoluments by 47 percent, while only losing one director.
Of the 17 increases, six boards have increased their bill for total emoluments by more than 20 percent.
These are, in addition to SAB (63,2 percent) and Rainbow (60,8 percent), Pep Limited (47 percent), Plate Glass and Shatterprufe Industries (40,5 percent), Sappi Limited (24,2 percent) and Tongaat Hulett (22,6
Rainbow this week said the increase was due to the number of executives, but the company only added one director. This year’s emoluments of R3,157-million is substantially higher than last year’s figure of R1,963- million. Taking the new director into account, the increase averages out at 40,7 percent per director. More to the point, profits more than doubled to R16,7-
The same calculation, applied to Tongaat Hulett, shows an average increase of 40 percent. The group executives awarded themselves R9, 723-million for 1995, after an amount of R7,928-million last year. Attributable earnings were 55,4 percent up on last year’s figure of
SAB, though showing the highest overall increase in executive directors’ emoluments, added three executives this year, which brings the average increase down to 24 percent. This year’s emoluments are up from last year’s figure of R7,074-million to R11,548-million. After-tax profits were around 30 percent up at R1 289,3-million.
SAB group secretary Andrew Tonkinson said this figure could have been distorted because two of the executive directors were located off-shore, and had to be paid in
The six executive directors at Plate Glass and Shatterprufe Industries received a total of R1,117- million this year (excluding profit improvement-related incentives). Last year, the figure was R831 000.
After cutting down on three directors, Sappi this year shows an average increase in directors’ pay of 24 percent.
Pep’s top brass last year awarded themselves R2,590- million while awarding themselves R3,804-million for this year. The directors received an average increase of 34,6 percent which is 13 percent higher than the profit percentage.
Of the 26, only Anamint and M-Net did not increase the amount for directors emoluments. In M-Net this is surprising, considering its recent financial success.