Turnbull calls out 'extraordinarily high' CEO pay
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Turnbull calls out 'extraordinarily high' CEO pay

Prime Minister Malcolm Turnbull has described the pay of the country's top executives as "extraordinarily high" after a report found salaries for the top 100 CEOs rose 12.4 per cent in one year.

On Tuesday, the Australian Council of Superannuation Investors released analysis showing Domino's Pizza boss Don Meij had topped the table of Australia's highest-paid chief executives, taking home $36.84 million - almost 435 times the full-time average wage.

"The pay rates of people working for a lot of big [publicly] listed companies is extraordinarily high,” Mr Turnbull said.

The report said that incentives meant median "realised" pay for an ASX100 CEO rose 12.4 per cent to $4.36 million in the 2017 financial year, and the average was up 9.3 per cent to $6.23 million.

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ACSI and some politicians have said CEO pay may need to be capped if greater transparency is not introduced and bonuses are not limited.

But Mr Turnbull said it was a free market and shareholders were increasingly objecting to high CEO pay.

“I think you're seeing more activism and that's the way it should go and they've got the ability, of course, to reject the remuneration packages nowadays," he told 3AW's Neil Mitchell.

Domino's Pizza chief executive Don Meij has topped the table of Australia's highest-paid chief executives, taking home $36.84 million.

Domino's Pizza chief executive Don Meij has topped the table of Australia's highest-paid chief executives, taking home $36.84 million.Credit:Robert Shakespeare

A spokeswoman for Domino's said remuneration for Mr Meij was "linked to the achievement of significant long-term targets for the business over a period of three years" and that over this time period, underlying earnings per share more than tripled from 41.5 cents to 133.6 cents per share.

ACSI’s report found that of the nation’s 100 largest companies only six CEOs eligible for a bonus in the 2017 financial year were not awarded one. About one in three ASX 100 chief executives were awarded at least 80 per cent of their maximum bonus.

Former Labor treasurer Wayne Swan said "if company boards can’t impose pay restraint on these exorbitant executive salaries, it’s time for shareholders to take matters into their own hands and agitate for a binding vote to cap CEO pay".

Labor MP Ed Husic said the nation’s wealth was not being evenly distributed and described high CEO pay as “a form of wealth hoarding”.

Labor's Ed Husic says high CEO pay is "a form of wealth hoarding".

Labor's Ed Husic says high CEO pay is "a form of wealth hoarding".Credit:Mick Tsikas

“Senior managers are doing well," he told Sky News. "Investors [are] doing well but ordinary Australians that earn their living through a wage are not being able to get ahead."

ABS data shows that in the 12 months to November 2017, the average full-time wage, with overtime and penalty rates, was $84,661.20 annually.

Greens Treasury spokesperson, Senator Peter Whish-Wilson, said the minor party had proposed legislation to cap executive pay in the private and public sector. “Everyone knows that our CEOs are not worth this much," he said.

Australian Institute of Company Directors CEO Angus Armour said investors and the community expect to see pay aligned with performance. "This is especially important in a low-trust environment," he said.

The ACSI report noted the uplift in realised pay for CEOs had correlated with strong market performance. Mr Armour said there was increasing focus on non-financial risk issues.

The Business Council of Australia and Australian Industry Group declined to comment.