Key Insights

• Selective Insurance Group's Annual General Meeting to take place on 1st of May

• Salary of US$1.00m is part of CEO John Marchioni's total remuneration

• The overall pay is comparable to the industry average

• Selective Insurance Group's total shareholder return over the past three years was 42% while its EPS grew by 13% over the past three years

It would be hard to discount the role that CEO John Marchioni has played in delivering the impressive results at Selective Insurance Group, Inc. (NASDAQ:SIGI) recently. Shareholders will have this at the front of their minds in the upcoming AGM on 1st of May. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

See our latest analysis for Selective Insurance Group

How Does Total Compensation For John Marchioni Compare With Other Companies In The Industry?

Our data indicates that Selective Insurance Group, Inc. has a market capitalization of US$6.3b, and total annual CEO compensation was reported as US$6.0m for the year to December 2023. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.0m.

On comparing similar companies from the American Insurance industry with market caps ranging from US$4.0b to US$12b, we found that the median CEO total compensation was US$8.3m. This suggests that Selective Insurance Group remunerates its CEO largely in line with the industry average. Moreover, John Marchioni also holds US$14m worth of Selective Insurance Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 13% of total compensation out of all the companies we analyzed, while other remuneration made up 87% of the pie. Selective Insurance Group is paying a higher share of its remuneration through a salary in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Selective Insurance Group, Inc.'s Growth

Selective Insurance Group, Inc.'s earnings per share (EPS) grew 13% per year over the last three years. In the last year, its revenue is up 19%.

Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Selective Insurance Group, Inc. Been A Good Investment?

We think that the total shareholder return of 42%, over three years, would leave most Selective Insurance Group, Inc. shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 1 warning sign for Selective Insurance Group that investors should look into moving forward.

Important note: Selective Insurance Group is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.