COMPANY COMMENT: Coronation’s strange and secretive payouts
Coronation’s stupendously rich rewards raise questions about the possibly of some sort of market failure
In the not-too-distant future we’re going to look back on the structure and value of Coronation’s remuneration policy and wonder how it was possible. To be able to ring-fence 30% of pretax profit and allocate it at will to key employees will seem a wondrous thing in probably no less than five years.These are not small amounts. In financial 2016, the 30% was worth about R620m and in 2015, it was worth an eye-popping R720m. Certainly, Coronation’s fund management team deserves to be rewarded, richly. But when the rewards are this rich, you have to wonder if we’re not dealing with some sort of market failure. Of course, we’ll never know just how rich individual rewards are because of the poor levels of disclosure. For the same reason, we’ll never know what performance measurements were used to make the awards. At this year’s annual general meeting, the Coronation board told shareholders it was no one’s business but those of the executives involved. It continues to claim the trust that ...
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