Ayala’s six execs got P214-M perks in 2012
top officers but more importantly how much one gets in salary, bonus and other perks?
What LFM did to Maramba’s pay package, it also applied to the others. It divided Carlos Uy’s compensation into salary, P1.067 million, bonus, P5.418 million, and others, P52,000; Lopez’s into salary, P1.776 million, bonus, P4.476 million and others, P47,000; Uy’s (Sandra) into salary, P1.038 million, bonus, P5.418 million and others, P52,000.
A total for all. If LFM makes public some information that the rules do not require, how about the others? Are other listed companies as open, if not more open, to their small stockholders when it comes to sensitive numbers such as those related to one’s compensation? Again, only the numbers would show if other companies are as transparent as LFM with the pay envelopes of their executives.
Ayala Corp. ( AC) would be a good illustration. In its latest posting on the Philippine Stock Exchange website, AC gave the following information: “CEO [chief executive officer] and most highly compensated executive officers*” were paid P170.48 million in salary and P97.61 million in other income in 2011; P184.05 million in salary, and P213.95 million in other income in 2012 and projected salary of P198.77 million and other income of P86.81 million in 2013.
Then in the same filing, AC disclosed the compensation of “all other officers** as a group unnamed: salary, P330.93 million and other income, P161.73 million in 2011; salary, P396.37 million and other income, P333.36 million in 2012 and as projected, salary, P399.97 million and other income, P177.49million in 2013.
Exposing the asterisks. In going over the numbers, an investor interested in knowing “who gets how much,” would notice the presence of asterisks in AC’s reports. At a casual glance, if one who relies on disclosures in making investment decisions happens to read only in passing, meaning without much giving attention to details, then he would easily believe his first impressions that the disclosed amounts would be enough and correct. Yet, AC’s compensation disclosure makes one wonder who among the highest paid officers gets more of the pie and who gets less.
Incidentally, this limited disclosure is not a monopoly of the Zobel-controlled companies. Everybody else— except perhaps LFM—has been doing it, making life more difficult to the small stock investors. Hopefully, LFM would continue religiously follow the market’s rule on full disclosure although lately, it has not been updating the market on the activities of its directors inside its board room.
Six highest paid execs. The single asterisk identifies AC’s five best paid officers, namely Jaime Augusto Zobel de Ayala, chairman and CEO; Fernando Zobel de Ayala, president and chief operating officer and other non-seconded members of the management committee as of December 31, 2012, namely John Eric Francia, group head, corporate strategy and development; Delfin Gonzalez Jr. chief finance officer and chief risk officer; Solomon Hermosura, corporate secretary and group head of legal and compliance; and John Philip Orbeta, group head of corporate resources. In addition, they are also managing directors.
Doing the subtraction. Below the compensation table, one would find, as denoted by two asterisks in officers, that “all other officers** as a group unnamed” mean “managers and up [including all above-named officers]. “All above named officers refer to the six highest paid executives. Translating the footnote into numbers via subtraction, “all other officers as a group unnamed”—this time excluding the amounts credited to the six highest paid officers as a group—actually received P160.45 million of the total in salary, and P85.12 million in other income in 2011; P213.32 million in salary and P119.41 million in other income in 2012 and as projected, stand to get P201.12 million in salary and P90.68 million in other income in 2013.
In an explanatory note to the compensation, AC said that the “total annual compensation” consisted of “basic pay and other taxable income” such as “guaranteed bonus, performance- based incentive and exercise of stock options.” This should explain the huge increase of 119.189 percent in the total “other income” of AC’s six most compensated officers to P213.95 million in 2012 from P97.61 million in 2011.
esdperez@gmail.com