Unhappiness over pay rules dealt with, says Naspers

● Naspers, which received an unprecedented backlash against its pay policy last year, says it is confident it has addressed shareholder concerns after months of discussions with investors.

On Friday the internet company said in its annual report it had improved transparency — its 2018 remuneration report was doubled to 24 pages — while it had also made changes to pay structures to align management and shareholder interests, in addition to an overhaul of its remuneration committee.

The report shows that CEO Bob van Dijk’s total pay for the year to March declined 3% to $12.2-million (about R164-million) because the value of his share options, which form part of his long-term incentive plan, shrank.

Finance chief Basil Sgourdos’ total pay rose 13% to $3.5-million thanks to his being awarded more share options. On average, Naspers employees earned about $56 000 each since the group spent $1.4-billion on salaries, wages and employee benefits on its 24 887 permanent employees.

Aileen O’Toole, Naspers’ chief people officer, told Business Times she was “confident” that the group had addressed the main shareholder concerns over pay.

“I’ve personally engaged with a lot of our bigger shareholders, but also any other shareholders who’ve expressed questions or concerns around the remuneration topic — we’ve had several conversations this year,” O’Toole said. Naspers had also spoken to external advisers and benchmarked its pay to competitors’ to make sure it retained staff.

Last year, nearly two-thirds of ordinary shareholders voted against the pay policy of Africa’s biggest company. However, thanks to Naspers’ dual-class share structure, which gives certain investors far higher voting rights than others, the policy was approved.

Naspers had also made “design changes” to ensure tighter alignment between management and shareholders by introducing clawback provisions linked to the incentive schemes of all executive directors.

Getting the pay policy right was important because of “fierce” competition for the best people in the consumer internet market, O’Toole said.

“The very best people have real choice about where they want to work. Our good people get several calls a month in terms of new opportunities — but that’s no different for our competitors.

“Ultimately, of course, we have to attract and retain and motivate the world’s best digital talent because if we don’t have those people we don’t have a business.”

However, pay was no longer a “primary motivator” in the industry, she said.