Be prepared to spend more on your beer – Comment

The news of higher beer prices will go down very well with consumers who have been told only a few weeks ago that AB-InBev’s compensation for their 13-member executive board nearly doubled in the first half of the year.

Total compensation for the executive board led by Chief Executive Carlos Brito increased to USD 73 million in the first half of the year, up 92 percent from USD 38 million a year earlier, according to U.S. media sources.

The figures had originally been dug up by Belgian journalists.

After not receiving bonuses last year on the highly spurious grounds that “they had missed targets”, AB-InBev’s executives more than made up for this loss when they received bonuses this year after meeting internal targets for market-share gains, cost cuts and the reduction of debt, the Belgian magazine Trends wrote.

The figure includes taxes, social-security contributions, pension-plan payments and the cost of stock options.

We think that SABMiller’s CEO Graham Mackay should point this out to the institutional investors, who had complained about his “excessive” pay on the occasion of SABMiller’s AGM in July.

Having done our sums on the back of a napkin, we think that Mr Mackay’s total compensation should be broadly on par with his colleagues at AB-InBev. But don’t forget: SABMiller is not bogged down by the sort of debt AB-InBev are.