Meeting date: May 29, 2015 Roper Technology may be a company you’ve never heard of. It is involved in healthcare technology, healthcare equipment, energy systems, electronic instruments, and, as the company puts it, “other asset-light niche technologies.” But as a Tampa Bay Business Journal reporter notes, CEO Brian Jellison is paid more than executives at many large name brands: “Jellison’s 2014 total compensation of $22.7 million puts him ahead on the list of CEOs from Starbucks (Howard Schultz, $21.5 million in 2014 pay), Wells Fargo (John Stumpf, $19.3 million) and Walmart Stores (C. Douglas McMillon, $19.1 million), among others.”
The company’s performance has been solid, but only 80% of shareholders supported the advisory vote last year. The company reports that after, “taking into consideration input from investors, last year’s Say on Pay vote, external developments, and internal considerations,” Roper took numerous action on compensation. Many of the changes – including a longer term focus -- are positive but none of them changed a fundamental issue: pay for Jellison is well above that of peers.
The company includes a table in its proxy statement that lists peer groups and helpfully compares the enterprise value, market capitalization, revenue and net income with that of Roper. What the chart does not include, is a comparison to compensation. When I compared total disclosed compensation for the 12 disclosed companies, only one had higher CEO pay.
A look through the past few proxy statements also shows that the company has had significant changes in its peer group, which raises additional concerns. Only five of the current peers were listed as peers just two years ago.
The company says that Jellison is paid less than he would be if he worked at a private equity firm, and that his pay is reasonable for a “high-performing, long-tenured” CEO. However, the magnitude of his pay is such that shareholder may wish to vote against his package.