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https://www.businessdailyafrica.com/corporate/companies/Centum-sets-new-record-with-CEO-pay/4003102-4093952-xxxeuaz/index.html

[SIZE=7]Centum sets new record with Sh375.6m CEO pay[/SIZE]
WEDNESDAY, SEPTEMBER 13, 2017 11:19https://www.businessdailyafrica.com/image/view/-/4093990/medRes/1751374/-/maxw/960/-/g1atcw/-/james+mworia.jpgCENTUM INVESTMENTS CHIEF EXECUTIVE OFFICER JAMES MWORIA. FILE PHOTO | NMG
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Why we stand by our story on Centum CEO pay
The Centum Investment CEO James Mworia, in several tweets Wednesday, challenged the accuracy of this story headlined: “Centum CEO sets new record with Sh375.6m CEO pay.”
We indicated, in our response to the tweets, that we stand by our story which is based on the company’s disclosures in its latest annual report.
Here are the reasons why we stand by the story:
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[li]There annual report tabulates key management compensation, which includes pay for executive directors and senior management. This was given as Sh614.9 million and Sh711.5 million for the years 2017 and 2016 respectively, at the group level.[/li][li]There is additional disclosure of the management team remuneration, now narrowed down to those who are executive directors. This is given as Sh375.6 million and Sh201.1 million for the years 2017 and 2016 respectively, again, at the group level.[/li][li]Mr Mworia is the only executive director at the group level at Centum, and the amounts above are attributable to him alone going by the presentation in the annual report.[/li][li][I]“The board has only one executive director to prevent conflicting roles between the Management and the Board of Directors,” Centum says in its 2017 annual report.[/li]https://www.businessdailyafrica.com/image/view/-/4095496/medRes/1752326/-/1338nt6z/-/centum.jpg[/I]

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Centum Investment’s chief executive James Mworia’s total pay rose 87 per cent to a record Sh375.6 million in the year ended March compared with Sh201.1 million the year before, taking his cumulative eight-year pay to nearly Sh1 billion.
The compensation, which extended Mr Mworia’s record as corporate Kenya’s highest-paid CEO, was equivalent to Sh31.3 million per month, according to disclosures in the company’s latest annual report.
READ: James Mworia: Law intern who rose to best paid CEO in Kenya
The bulk of Mr Mworia’s remuneration is made of a performance bonus scheme, whose targets the Centum chief executive and his management team have consistently met over the years, drawing hundreds of millions of shillings in return.
Mr Mworia’s take-home is particularly unique in the fact that his monthly salary is a more modest Sh2 million or about Sh24 million a year – translating to a small fraction of the annual total remuneration for the 40-year-old executive.
At Sh375.6 million, Mr Mworia’s total remuneration places him ahead of the pay of the chief executives of the five largest firms by market capitalisation at the Nairobi Securities Exchange, including Safaricom, East African Breweries Limited and KCB Group.
Safaricom’s Bob Collymore and KCB’s Joshua Oigara in December 2015, announced they were on a monthly pay of Sh9 million and Sh4.9 million, adding up to Sh108 million and Sh58.8 million respectively.
READ: How CEOs hide their pay details
Sharp rise
Mr Mworia was already making multiples of the two CEO’s pay by 2012, his compensation having risen sharply when Centum started reaping the benefits of its big shift from passive equities investments to large-scale projects in different sectors of the economy.
The Centum chief executive’s remuneration has grown at an annual compounded rate of 64.6 per cent in the past eight years when the company has also grown its market capitalisation and total assets to stand at Sh28 billion and Sh88.3 billion respectively.
Mr Mworia has excelled at implementing Centum’s earlier decision to invest big in areas such as real estate and fast moving consumer goods, raising debt, selling some assets and structuring joint ventures to fund the capital-intensive projects.
The ventures have grown in value, allowing the company to book multi-billion-shilling gains and ultimately satisfying the bonus payment criteria of clocking a minimum return of 15 per cent on net assets each year.
READ: Centum defies profit drop, raises payout to Sh800m
Individual performance
Centum previously said employees were entitled to 20 per cent of any return above the set benchmark, with the absolute payout also based on individual performance.
The new annual report is silent on what portion of the excess return accrues to employees, indicating that the level could have changed.
The investment firm beat the hurdle rate by a whisker, allowing the senior management team to book new bonuses whose payments is spread over several years to encourage them to stick around.
Centum reported a net return of Sh6.3 billion in the year ended March when the opening shareholder funds stood at Sh39.3 billion, representing a return rate of 16 per cent.
This created an excess of some Sh390 million in absolute terms, part or all of which was available for distribution to eligible staff.
Employees of the company had accrued bonuses of Sh716.2 million in the review period compared to Sh987.4 million the year before, making the workforce of less than 200 one of the highest-paid in the country.
“The group has in place a performance bonus scheme. The scheme rewards employees of the group based on achievement of certain set benchmarks of business success,” Centum said in the report.
READ: Centum set to buy 5.5 per cent stake in Deacons
Consistent growth
“The group’s performance bonus scheme is designed to enable achievement of consistent business growth that is tied to the increase in shareholder wealth, which is the primary business objective. A hurdle rate of 15 per cent annual increase in return based on the opening shareholder funds has been set.”
The bonus is payable in three equal installments over three years, with accrued payouts continuing only if the net asset value is maintained or increased from the prior year.
The acquisitive company has racked up major fair value gains during Mworia’s tenure, with these standing at a cumulative Sh24.1 billion in the year ended March across subsidiaries including Two Rivers Development (which partly owns the Two Rivers Mall) and Coca-Cola bottler Almasi Beverages.

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Let me console myself as other peasants - yote ni vanity.

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wueh!

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At least they are open and earning their money the right way … Centum may grow to become like the Goldman Sachs of the US .

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And then we have this. Money, Money, Money, Moooooney!!!

[SIZE=7]KCB sets the pace for executive pay reporting with detailed account[/SIZE]
MONDAY, APRIL 9, 2018 10:31https://www.businessdailyafrica.com/image/view/-/4378584/medRes/1804406/-/maxw/960/-/rbtlb5/-/oigara.jpgKCB GROUP CHIEF EXECUTIVE JOSHUA OIGARA. FILE PHOTO | NMG
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Kenya’s biggest bank by assets, KCB, has set the pace in executive pay reporting with a comprehensive account of its directors’ remuneration, making it the first bank to comply with the new reporting demands.
KCB says in its financial report for the year ended December 2017 that it paid its chief executive, Joshua Oigara, Sh256 million, placing him among the best paid executives in Kenya and giving shareholders the very first insight into the nature of compensation at the top of the business.
Mr Oigara’s Sh256 million compensation for 2017 means his pay rose 14 per cent from Sh224 million in 2016, the bulk of it in bonuses.
Mr Oigara said the compensation is in line with the bank’s policy that ties pay to performance.
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READ: Centum sets new record with Sh375.6m CEO pay
ALSO READ: Kenya’s pampered CEOs
The bonuses are, for instance, tied to achievement of multiple metrics, including profitability of the group and at all times reflect the bank’s performance in a year, he said.
KCB says its executive pay is the sum total of many factors starting from the market average obtained through a regional survey of executive compensation all the way to bonuses that are linked to a range of metrics such as return on equity.
“We (KCB), together with Equity Group and an Egyptian bank, have one of the highest RoE (return on equity) on the continent,” Mr Oigara said, even as he pointed out that remuneration of bank executives in East Africa remains way below those of their peers in West and Southern Africa.
Multinational banks
Mr Oigara reckons KCB’s performance should be measured against other multinational banks with which it competes for international investors.
The Financial Times places KCB in a peer group of seven banks, including Kenya’s Equity, Co-operative Bank, Oman’s Bank Dhofar, Qatar’s Ahli Bank QSC, Qatar International Islamic Bank QPSC and Morocco’s Marocaine pour le Commerce et l’Industrie Banque SA.
Of the seven, KCB had the highest net income growth rate over the past five years at 10.06 per cent, followed by Equity (9.33 per cent), Co-op (8.11 per cent) and Ahli Bank QSC (6.58 per cent).
In the local market, KCB reported the largest net income of Sh19.7 billion in the year ended December, followed by Equity (Sh18.8 billion) and Co-op (Sh11.4 billion).
READ: Equity, Co-op CEOs earn millions from bank profits
Equity however leads with an RoE of 20.2 per cent, enabling it to trade at a high premium on the Nairobi Securities Exchange (NSE) where it leads other banks with a market capitalisation of Sh206 billion.
KCB, whose RoE stands at 18.5 per cent, is second with a market value of Sh165.5 billion.
KCB, however, has the largest absolute cash return of Sh9.1 billion or a dividend of Sh3 per share, followed by Equity’s Sh7.5 billion or Sh2 per share.
Sh1m each day
At the current rate, Mr Oigara’s pay amounts to nearly Sh1 million for each working day and is 72.1 times the average Sh3.5 million paid to KCB’s 5,393 permanent employees.
KCB’s employees are paid a bonus only if they achieve 95 per cent or more in a scorecard of the set targets.
Mr Oigara’s salary rose 14 per cent to Sh65 million or Sh5.4 million per month in the year ended December 2017, according to the just published annual report.
His bonus was left unchanged at Sh147 million, in line with the bank’s flat net earnings of Sh19.7 billion in the period.
Tripled allowances
The KCB CEO’s allowances, however, more than tripled to Sh30 million while his gratuity increased 18 per cent to Sh13 million even as his non-cash benefits remained unchanged at Sh1 million.
KCB paid its chief financial officer, Lawrence Kimathi, a total of Sh59 million in the review period, after raising it 37 per cent from Sh43 million in 2016.
Mr Kimathi’s salary rose seven per cent to Sh29 million or Sh2.4 million per month while his bonus more than doubled to Sh23 million.
His non-cash benefit was retained at Sh1 million while his gratuity increased 20 per cent to Sh6 million.
While KCB and other listed companies are required to disclose the remuneration of their directors, it is not clear how far the pay disclosure should go.
READ: How CEOs hide their pay
ALSO READ: 7 NSE firms reveal details of CEO pay

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1M per day iko sawa. With KCB share ikipanda at the rate of a Bob per day, dividends of 2 Bob n 3 Bob in the last three years, isokei.

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This looks like a face value interpretation. Most of these companies retain bonuses and pay them as a lump sum after a specified period to maintain the performance levels of top executives.

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Corporate world apana mbaya:D

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yaani CEOs are earning first world salaries in a third world country? Talk of inequality. And the real workers take home in the region of 50k a month.

Afadhali hata mtu anyamaze na asiseme ile anapata. the divide btwn the haves and have nots is now beyond abnormal.

Yaani you earn the same as the CEO of coca cola worldwide na uko third world country, God have mercy.

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Hehe in 2 or 3 years you make a billion bob…

Where do you even keep money like these? Have we gone mad greed?

Basi collymore lazma anaguza a clean billion a year.

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Uhai ndio muhimu :smiley:

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Infact the two guys I can bet their wives cannot make round chapatis with layers so they don’t have everything :D:D:D

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Baas.
Hehehehe.

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They can import either the chapos or a chef

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I’m excited by this news because of these 5 reasons.

  1. he is one of us. He is not kina Bob Collimore or Michael Joseph who are foreigners
  2. he works in the corporate world and not for GoK. In the corporate world talent alone is what keeps you going.
  3. he is a black man. In Kenya it appears that only Indians, Pakistanis and wazungus can earn those high salaries in the corporate world. He rubbishes that notion
  4. he was educated in Kenya. That idea that Kenyan education is inferior is thrown into the dustbin
  5. he’s not 65 years old.
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Still not the same

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When your two siblings are both professors and you were the best student at undergrad level it can only mean that you were wired with the right genes. First heard about him at Bamburi

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Their parents are Kenyan heroes. They raised top scorers

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Spot on mate. +10