Lonmin’s Ben Magara declines pay rise for second consecutive year
Lonmin CEO Ben Magara declined a salary increase in the year to September for the second year in a row although the platinum mining group turned from an underlying loss of $134m in 2015 to a profit of $7m after a rights issue and a restructuring.
Executive remuneration is a sore point around the world, but particularly in SA’s mining industry because of the huge gap between top management’s earnings and those of the lowest paid unskilled workers.
Although his basic salary was flat, Magara’s total remuneration rose significantly because of the vesting of retention awards granted when he was appointed in 2013, some of which were deferred.
Chairman of Lonmin’s remuneration committee Jim Sutcliffe said, in the group’s annual report released on Thursday, that the committee was prepared to award him an annual salary increase of 2%, partly to take inflation into account since his salary was last changed. However, Magara had waived the increase.
Magara is paid in pounds sterling. His basic salary was the same, at £462,150, for 2016 and 2015, but there was a 9.4% increase in the value of his taxable benefits, such as car allowance and medical cover. He received another £357,480 in short-term and other incentives, making his total remuneration for the year £939,603 (about R16m).
Magara’s fellow executive directors, Ben Moolman and Barrie van der Merwe, who are paid in rands, were awarded salary increases of 5%.