Safaricom CEO takes home Sh289 million as directors' pay up marginally

Safaricom PLC CEO Peter Ndegwa. [David Gichuru, Standard] 

Safaricom Chief Executive Peter Ndegwa took home Sh288.9 million in remuneration for the year ended March 31, 2022.

This was a 43 per cent increase from the Sh201.5 million he was paid the previous year with the rise largely attributed to his bonus payout.

Data from the company's latest annual report indicates Mr Ndegwa received Sh178.8 million in bonuses during the year, a 98 per cent increase from the Sh90 million he took home the previous year.

Safaricom says its remuneration policy, set in 2018, is guided by the findings of an independent survey compared against the remuneration of comparator organisations in the market.

"It is the view of the committee and the board that the company’s reward arrangements best support our business effectiveness by only delivering above target payouts when this is justified through company performance and the current policy will support the implementation of the company’s short-term and long-term objectives," the policy says.

Besides the basic pay, executive directors are entitled to an annual performance-based bonus, company shares under employee ownership plan, residential accommodation, utility bills payment, children's school fees and club membership.

In the current financial year, only Mr Ndegwa and Chief Financial Officer Dilip Pal are listed as Safaricom executive directors.

Board cCairman Michael Joseph has since been dropped off the executive director payroll and his total remuneration for the year ended March 2022 stood at Sh25.2 million, much lower than the Sh127.57 million he earned the previous year.

Overall, the company spent Sh471.5 million in directors' remuneration for the year, a marginal increase from Sh469.7 million spent the previous year.   

In recent years, Safaricom has recorded several changes at top management and the boardroom. Last month, Sylvia Mulinge, the company's chief consumer business officer, left the firm to assume the CEO position in MTN Uganda.

Her exit came a month after Chief Enterprise Business Officer Kris Senanu left the company.

Former Safaricom Chief Consumer Business Officer Sylvia Mulinge recently appointed new MTN Uganda CEO. [File, Standard]

Other high-ranking personnel to have left in recent years include former Chief Financial Officer Satesh Kamath who left in 2020 to assume the same position at Vodafone Business, and former Chief Corporate Officer Stephen Chege, who is now Vodacom's Group chief external affairs officer.

Data from the telco's latest annual report indicates that the company now has 5,941 full-time employees and contractors, with 305 new staff onboarded in the year under review to spearhead the expansion to Ethiopia. 

The company's salary costs rose 14 per cent to Sh17.1 billion from Sh15 billion the previous year, with management indicating that competition from other fintechs is making it challenging to retain key talent. 

"Human Resources faced a number of challenges during the 2022 financial year with the principal areas of concern being the retention of key talent due to the current business operating environment," said the firm in the annual report.

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