Domino’s boss “welcomes” CEO pay transparency plan

Domino’s boss Don Meij
Domino’s boss Don Meij

Domino’s CEO Don Meij said that he “welcomes” a consistent measurement for executive and employee pay like the one proposed by the Labor government on Tuesday, which would require listed companies with more than 250 employees to report how their chief executive’s pay compares to the median worker’s salary.

In a statement provided to Inside Retail, Meij said that Domino’s “looks forward” to more discussion of team member pay.

“[As] it currently stands, we proudly pay our team member wages among the highest in the country. We understand we are the only large fast food business in Australia paying according to the Modern Award,” he said.

Meij was the subject of some criticism in July, when he was named Australia’s highest paid chief executive by the Australian Council of Superannuation Investors (ACSI).

While his reported salary at $4.6 million was well below that of Westield’s Peter and Steven Lowry at $21.4 million, Meij’s “realised pay” – which includes the value of shares and equity in the year they are received – was $36.8 million in fiscal 2017, according to ACSI.

Meij told the Australian Financial Review that it was “factually incorrect” to say he was paid that figure.

But the recent scrutiny of Meij and Domino’s is just one example of the growing concern about CEO pay at a time when other workers’ salaries are stagnating.

On Tuesday, shadow assistant treasurer Andrew Leigh laid out a plan to keep CEO pay ratios in check with a policy that would require listed companies with more than 250 employees to report how much chief executives earn in comparison to the median worker’s salary.

This forced transparency would ostensibly empower employees and shareholders and encourage businesses to provide a public explanation of their remuneration strategy.

“This policy addresses public concern that CEO salaries are growing at an unfair rate and leaving workers behind,” Dr Leigh said.

“By extending current market reporting requirements for public companies, it will help inform investors as they calculate risks and decide where to invest their money.”

In July, then prime minister Malcolm Turnbull said shareholders increasingly objected to high CEO pay. He said more investors had used their ability to reject remuneration packages, backing their rights as activists.

According to the figures that ACSI released in July, CEOs at the nation’s 100 biggest ASX-listed companies took home an average $6.2 million of “realised pay” in 2017.

The survey found that pay packets at Australia’s 100 biggest companies returned to pre-global financial crisis levels in 2017.

If Labor wins the next election, it plans to put the reporting regime in place from the 2021 financial year to allow companies to comply with the new requirements.

You have 7 articles remaining. Unlock 15 free articles a month, it’s free.