What is an appropriate level of pay for the chief executive of Glanbia? The fact that it was started by Irish farmers and its largest shareholder is an Irish farmers’ co-op is largely irrelevant.
I must admit to a personal interest. As a farmer, I trade with Tirlán (the new name for Glanbia Co-op), and so almost automatically I have a very modest number of shares in both Tirlán and Glanbia plc.
Tirlán is a purely agricutural business, with the specialist quoted company retaining the Glanbia name.
Most of Glanbia plc’s business is done in the US, but I suspect I am not alone in viewing it as an Irish company that grew out of the old Waterford and Avonmore Co-ops, with Tirlán still owning 27% of the plc, and a signifigant percentage of the remainder owned by individual farmers or their families.
This is one of the contexts in which Siobhan Talbot’s almost €6 million package for 2022 is inevitably viewed.
The more relevant is the performance of the company itself under Ms Talbot’s stewardship, while a third consideration has to be how does this package compare with other companies quoted on the Irish stock exchange doing a large percentage of their business in the United States of America.
Broadly, on a five year basis, the company has grown sales and the company has recovered well after the COVID-19 setbacks. However, net income is still below that of 2018 and with a few ups and downs, the share price has broadly stagnated over the last five years.
It is worth noting that for 2022, Ms Talbot’s package is more than 60% more than that of the Kerry chief executive’s, who was paid €3.9 million for running a company valued at €16 billion compared with Glanbia’s €3.5 billion, while she was paid roughly half the amount awarded to the CEO of Ireland’s biggest company Cement Roadstone, which is worth ten times Glanbia’s value at €36 billion.
It seems clear to me that the Glanbia plc board, and especially its remuneration committee, have incorrectly pitched Ms Talbot’s package by setting performance targets and rewards that are inappropriate for a company of its size and performance record.
The package appears to have been too influenced by some of the excesses we have come to associate with some American CEO packages. These isolated packages in the US are inappropriate for Irish conditions.