Financial services group Discovery has hiked its minimum pay to R200,000 per year with effect from October, it disclosed in its 2024 annual report.
The report, published on Wednesday, said the company’s remuneration committee’s commitment was to ensure “fair and responsible” pay, while addressing pay gaps. It said it was continuing to review the vertical pay gap between its top 5% most paid employees and the bottom 5%.
Group CEO Adrian Gore in his letter to shareholders the group was also making strides in improving diversity at a management level.
“Diversity levels improved with 45% and 39% of our senior managers being female and black, respectively. We have a 0% gender pay gap for roles of the same size and over the period we increased our minimum pay to R200,000 per annum, more than three times the prescribed minimum pay in SA,” Gore said.
The minimum pay policy applies to all Discovery’s employees, except those on commission-based pay structures whose on-target commissions are equal to, or exceed, the R200,000 per annum.
Gore, who founded the company in the early 80s, was paid R31.6m, inclusive of incentives in the 2024 financial year, up from R27.9m in the prior year.
The group’s CFO Deon Viljoen was paid R25.9m, while Barry Swartzberg, the former CEO of Vitality Global, earned R22.5m.
One of the group’s best paid executives is the CEO of its bank, Hylton Kallner who was rewarded with R57.6m, coming second only to Vitality UK CEO Neville Koopowitz, who earned £2.8m (R64m).
In the year ended June, Discovery Bank reported a 29% surge in retail deposits to R18.5bn, while advances grew 27% to R6.6bn.
The fledgling bank narrowed its losses in the period to R454m, from R767m in the previous year. The bank, launched in 2019, has been reducing its losses since its formation. It reported an operating loss of R1.2bn in 2020, R1bn in 2021 and R990m in 2022.
The bank, which has breached the 1-million clients mark, was now targeting a profit of R3bn by financial year 2029.
The group grew normalised profit from operations by 17% to R11.5bn in the year to end-June, with strong contributions by Discovery SA and Vitality Global, increasing 16% and 57%, respectively.
According to Discovery’s minimum shareholding requirement (MSR) policy, which applies to senior executives, they are required to hold Discovery shares of five times the annual cost to company (CTC) for the group CEO, and two times the annual CTC for other executive directors and prescribed officers.
“As at June 30 2024, the group CEO’s holdings significantly exceeded the required holding. In addition, the group’s remaining executive directors and prescribed officers exceeded the required holdings.”
Discovery’s disclosure of its minimum pay follows that of Investec, Old Mutual and Santam. Investec minimum annual pay in SA stands at R250,000. However, the niche private banking and wealth management group has a yawning gap between its top 5% highest earning executives and the bottom 5% lowest paid workers.
Its 2024 annual reports shows that average single-figure total remuneration of top 5% SA-based employees was R10.1m per annum in the 2024 financial year, while the bottom 5% pocketed just R297,000.
Santam, SA’s largest short-term insurer, has hiked its minimum annual pay to R180,000, while Old Mutual has also benchmarked its minimum pay at R180,000.
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