Kogan restructures CEO pay around long-term shareholder returns
Kogan.com has overhauled the remuneration structure for founder and chief executive Ruslan Kogan, sharply reducing his fixed salary and removing short-term bonuses in favour of a long-term incentive linked to shareholder returns.
Under the new arrangement, Kogan will receive a salary of $50,000 a year, down by nearly $850,000, with the report saying he is expected to donate that amount to charity. His potential upside instead sits in a performance-rights package that could be worth about $50 million if demanding return targets are achieved.
The company will grant Kogan 6,740,331 performance rights. To benefit from them, the scheme requires total shareholder return of 100 per cent from a starting share price of $3.72, meaning the share price would need to reach $7.44.
Board shifts emphasis to long-term performance
Kogan.com chairman Greg Ridder said the board had responded to shareholder feedback and wanted stronger performance conditions around executive remuneration.
Ridder said the revised framework was intended to support the company’s entrepreneurial approach while maintaining clear accountability and alignment with shareholders. For Kogan specifically, he said the package represented a significant move away from conventional executive remuneration and placed greater weight on long-term value creation.
RBC Capital Markets equity analyst Wei-Weng Chen compared the structure with Tesla’s recent remuneration arrangements for Elon Musk, which also rely on ambitious targets before payments are received.
Chen said Kogan’s package was strongly aligned with shareholder returns because a large reward would only be available if the company delivered a correspondingly large increase in value.
Wider technology sector reviewing executive pay
The changes come as other listed technology companies reassess executive salaries and, in some cases, compare remuneration structures with US peers.
Kogan.com also said chief financial officer David Shafer would remain with the company until mid-2028 under a revised remuneration package. His cash bonus will be linked to a significant increase in the company’s share price over the next two years.
The report also pointed to recent remuneration debates at WiseTech Global and Xero.
WiseTech last month awarded chief executive Zubin Appoo a pay increase that almost doubled his package despite falling profits, a weak share price and a shareholder strike against the company’s latest remuneration report.
Around the same period, Xero recorded a second symbolic shareholder strike against its remuneration report.
Sandra Hook, chairwoman of WiseTech’s people and remuneration committee, said an independent review of Appoo’s pay had concluded he was underpaid compared with executives at similarly sized software companies internationally.
Kogan.com’s new structure takes a different approach by reducing guaranteed pay and placing a much larger portion of potential remuneration behind long-term performance hurdles. The package could deliver a substantial payout if shareholder returns double, but little additional reward if those targets are not reached.
SOURCE ATTRIBUTION:
Based on reporting by Zoe Samios. Source publication,
