The group’s annual integrated financial report showed that Basson took home R49.7m in basic pay, and was awarded a one-off discretionary cash bonus adding another R50m.
In its rationale, the remuneration committee said it took into consideration the fact that Basson had not claimed any increases in three years. He had not received any short-term incentive payments nor had he received benefits from any long-term incentive plans in the past five years, the committee said.
It had also factored in Basson’s length of service to the company of about 45 years and the results the group had achieved in the 2016 financial year "during very challenging economic circumstances".
In the report, the committee tackled questions from shareholders who sought clarity about the reason for Basson’s total guaranteed pay being higher than market levels in SA. It said as a major multinational retailer, the CEO’s pay was geared to be internationally competitive and that Basson’s shareholding in the company "aligns his interests with those of the shareholders over a long-term horizon". Globally, the retail environment was challenging and fast-paced. "Recently, in SA, it has become a trend for retailers to recruit their CEOs from multinational retailers outside of SA. Hence, it is evident that the war for talent in this space is not confined to the African continent.
"It is common market knowledge that both locally and internationally, the group has outperformed its peer companies over the past 10 years in terms of growth and shareholder return. This strong growth was the foundation for the group’s expansion into Africa, with Shoprite being the largest retailer on the African continent for a number of years. Such growth is spearheaded by strong leadership," the committee said.
According to professional services firm PwC, the average increase in total guaranteed package for executive directors of JSE-listed companies in 2015 was between 3% and 12%. CEOs in the largest companies got an average guaranteed package of R7.7m.
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