Loblaw CEO Galen Weston’s compensation jumps 55 per cent to $8.4 million
By Christopher Reynolds and Rosa Saba
Galen Weston took in $8.4 million in total compensation in the 2022 fiscal year in his role at the head of Loblaw Companies Ltd.
Meanwhile, Empire Company Ltd. CEO Michael Medline took in $8.7 million, while Metro Inc. CEO Eric La Fleche earned $5.4 million.
But Weston’s Loblaw compensation isn’t the full picture, as he is also head of the George Weston Ltd. holding company.
His total compensation reached $11.7 million in 2022, a nearly $1.1-million increase from the year before.
While Weston’s Loblaw compensation jumped significantly year over year, a 56 per cent increase compared with smaller increases received by his competitors, he was also promoted to the top leadership role midway through 2021, which means the two years aren’t directly comparable.
The proportion of Weston’s overall compensation from Loblaw versus the holding company shifted to 30 per cent from George Weston and 70 per cent from Loblaw as of May 6, 2021, compared with 60 per cent from George Weston and 40 per cent from Loblaw previously.
Weston’s total compensation from the two firms increased more than 11 per cent in 2022, while La Fleche’s went up seven per cent and Medline’s up 15 per cent.
It’s difficult to make a true apples-to-apples comparison of the three grocery executives’ compensation, said Eddington Ruiz, a senior consultant at Compensation Governance Partners. There are a few reasons for that, chief among them the fact that Weston holds two related but different roles.
In his dual role as head of the George Weston Ltd. holding company and its subsidiary Loblaw, made a total of $11.8 million in 2022 — a nearly $1.2-million increase from the year before. The figure includes his $8.4-million compensation from Loblaw.
More than half of that $8.4 million came from $4.8 million in share-based awards versus $2.5 million in 2021, as well as a $2.7-million annual bonus compared with $2.2 million a year earlier.
Share-based awards are a form of compensation that come as stock options or other equity-based compensation.
Shares of Loblaw closed at $125.91 Wednesday on the Toronto Stock Exchange, up more than 9 per cent from a year ago and just shy of its 52-week high of $127.19. Two years ago, before Weston stepped into his current role, it was closer to $70.
Loblaw spokeswoman Catherine Thomas said its bonus structure “goes well beyond executives.”
“Recently, more than 40,000 Loblaw colleagues received bonuses as part of their total 2022 compensation. These reflect strong company performance and recognize individual contributions throughout the business,” she said in an email.
Ruiz noted that another complicating factor is the fact that as Canada’s biggest grocer, Loblaw is bigger than its competitors. This was highlighted in a compensation review done by Meridian Compensation Partners, which used a group of Canadian and U.S. retailers and other companies to determine where Weston’s compensation fell in comparison with his peers.
Meanwhile, Metro’s and Empire’s most recent reviews use smaller groups of only Canadian companies.
Another, more minor difference is the three companies’ different financial years, said Ruiz: Loblaw’s fiscal year ended Dec. 31, while Metro’s ended Sept. 24. and Empire’s on May 7.
Ruiz said of the companies on the TSX 60 that have disclosed their compensation plans for the 2023 fiscal year, more than half are not considering notable increases. Among those considering one, Ruiz said Weston’s aggregate base salary increase is probably going to be on the higher end. However, he said the full picture won’t be apparent until all those companies have released their circulars and a full comparison can be made.
The grocery chain heads have come under increasing scrutiny amid runaway food inflation, telling a parliamentary committee last month that higher prices were not caused by profit-mongering and that their margins on food sales have remained low.
Statistics Canada data shows grocery prices rose 9.8 per cent last year, and 10.6 per cent year over year in February — more than double Canada’s inflation rate.
All three grocers raked in higher profits in the first half of 2022 compared with their average performance over the past five years, according to a report last fall by the Agri-Food Analytics Lab at Dalhousie University. But Weston told MPs that Loblaw has made bigger profits off financial services, apparel and pharmacy, and said food prices have increased about 25 times faster than Loblaw’s profit margins on food products.
MPs grilled the CEOs at the March 8 committee hearing on food inflation, with Weston in particular taking heat from NDP leader Jagmeet Singh, who repeatedly asked him, “How much profit is too much profit?”
Later in March, Walmart Canada CEO Gonzalo Gebara appeared before the same House of Commons committee with a similar message. Pierre Riel, Costco’s senior vice-president and country manager for Canada, is scheduled to appear before the agriculture committee on April 17.
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