Saturday, September 7, 2019

Midland, Texas-Based Concho Resources Inc's Top-Tier Executives Average Pay Raise Was a Clean, Blistering 31.2% Per Year During the Past Ten Years (2009-2018). The Permian Basin is Driving This.

The third Democratic 2020 Presidential candidate televised debate will be held in Houston, Texas on September 12, 2019.  Texas is also the home state of Julian Castro and Beto O'Rourke, who have both gained significant momentum in the past month.

The key issue to Texas citizens should be the huge and continuing Income Inequality Expansion which is at the core of many critical problems the US faces.

Thus I will be doing research and making posts on the average pay raise per year that the Top-Tier Executives of large Texas Companies were rewarded with in the past ten years.  I completed my study of large Texas Non-Oil &  Companies and now I have started studying large Texas Oil & Gas Companies. 

The 27th Texas Oil & Gas Company I am addressing here is Concho Resources Inc.

From annual compensation information contained in Company Proxy Statement filings with the US SEC, the chart at the very bottom below shows Concho Resources Inc's Top-Tier Executives Annual Total Compensation for each of two consecutive full years of employment for the past 10 years.
  
Concho Resources Inc's Top-Tier Executives Average Pay Raise was a clean, blistering 31.2% per year for the past ten years, which is the 4th highest of the 27 large Texas Oil & Gas Companies I have addressed so far.
  1. Cheniere Energy Inc +141.9% per year for the past ten years
  2. Kinder Martin +115.8% per year for the past ten years
  3. Diamondback Energy +52.9% per year for the past seven years
  4. Concho Resources +31.2% per year for the past ten years
  5. Marathon Oil +23.3% per year for the past ten years
  6. Energy Transfer Companies +19.2% per year for the past ten years 
  7. FMC Technologies +17.1% per year for seven years
  8. Spectra Energy Corp +16.4% per year for seven years
  9. Enterprise Products Partners +16.2% per year for the past ten years
  10. ConocoPhillips +14.8% per year for the past ten years
  11. Pioneer Natural Resources +14.4% per year for the past ten years
  12. Halliburton +14.3% per year for the past ten years
  13. Occidental Petroleum +14.3% per year for the past ten years
  14. Western Gas Partners +13.3% per year for the past ten years
  15. National Oilwell Varco+13.1% per year for the past ten years
  16. The New Baker Hughes, a GE Company +12.2% per year for the past three years  
  17. Plains All America Pipeline +10.4% per year for the past ten years
  18. Cabot Oil & Gas +10.3% per year for the past ten years
  19. Valero Energy Corp +10.1% per year for the past ten years
  20. The Old Baker Hughes Inc +9.9% per year for eight years excluding Golden Parachutes Pay
  21. Schlumberger Limited +9.6% per year for the past ten years
  22. Apache Corp +8.4% per year for the past ten years
  23. Noble Energy Inc +6.5% per year for the past ten years
  24. Phillips 66 +5.4% per year for the past five years
  25. EOG Resources +5.1% per year for the past ten years
  26. Exxon Mobil +1.2% per year for the past ten years
  27. Anadarko Petroleum +1.1% per year for the past ten years
There have been many US Government laws enacted in the past two decades that have substantially increased income inequality expansion, but none more so than the Trump Tax Cuts Act.   

On the other hand, the only highly effective US Government law enacted by either party in the past two decades that has substantially reduced income inequality expansion is Obamacare.

 My objective is to get a better handle on just why the US and particularly here Texas has such massive continuing Income Inequality Expansion ..... it appears to be predominantly about the relative long-term annual pay raise percentages for the executives of a Company vs the many non-executive employees of a Company, coupled with the stock price appreciation subsequent to the time the company executives were rewarded in their pay with stock equity compensation.

To fix Income Inequality driven mainly by Company and its Board of Director choices on Percentage Annual Pay Raises, the US Government should step in and pass wisely-designed, simple but effective Fair Pay Raise Income Inequality Narrowing Company tax incentives for rewarding non-executive employees with fair pay increases ..... the carrot ..... and Company tax disincentives for rewarding executive employees with clearly excessively high pay increases ..... the stick.  I am certain ..... it is simple math ..... that this tax proposal would be very effective in substantially reducing the huge income inequality expansion that has occurred for decades in annual percentage pay raises between company executives and the rest of the company employees. 

And the continuing annual net tax revenues raised by the US Government here should be set up in a separate fund to be used only for wise additional income inequality narrowing initiatives.  This fund should be run by an outside group made up entirely of minorities harmed the most by Income Inequality Expansion of the past decades  .....all women, all blacks, all Latinos, all other non-white people, all past and present union members, all LGBTQ, all non-employee contract workers and all middle and lower income people of all ages, including those retired.

Also, the US Government should require all US Corporate Boards to include at least one worker representative and to exclude any Company Executive.

Further, the US Government should ban Golden Parachutes.

FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE
Dec Dec Dec Dec Dec Dec Dec Dec Dec Dec
Concho Resources 2018 2017 2017 2016 2016 2015 2015 2014 2014 2013
Top-Tier Total Total Total Total Total Total Total Total Total Total
Executive Comp Comp Comp Comp Comp Comp Comp Comp Comp Comp
$ 000s $ 000s $ 000s $ 000s $ 000s $ 000s $ 000s $ 000s $ 000s $ 000s
Leach CEO     13,317     12,239     12,239     10,810     10,810     13,781     13,781     11,392     11,392       9,274
Harper CFO       6,415       5,505       5,505       4,879       4,879       5,492       5,492       5,139    
Wright COO       5,464       6,195       6,195       5,409       5,409       6,128       6,128       5,556       5,556       4,754
Giraud EVP       5,906       5,174       5,174       4,367       4,367       4,875       4,875       3,867       3,867       3,259
Guthrie SVP       2,920       2,910       2,910       2,748    
Holderness Former CFO       2,183       3,799       3,799       3,402       3,402       3,029
 Totals      34,022     32,023     32,023     28,213     27,648     34,075     34,075     29,356     24,217     20,316
Annual % Change vs Prior Year 6.2% 13.5% -18.9% 16.1% 19.2%
5 Year Average Per Year % Change 7.2%
FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE
Dec Dec Dec Dec Dec Dec Dec Dec Dec Dec
Concho Resources 2013 2012 2012 2011 2011 2010 2010 2009 2009 2008
Top-Tier Total Total Total Total Total Total Total Total Total Total
Executive Comp Comp Comp Comp Comp Comp Comp Comp Comp Comp
$ 000s $ 000s $ 000s $ 000s $ 000s $ 000s $ 000s $ 000s $ 000s $ 000s
Leach CEO       9,274       7,244       7,244       4,215       4,215     11,419     11,419       2,635       2,635       2,645
Harper CFO       2,190       1,685       1,685       2,624       2,624          967          967          833
Wright COO       4,754       3,275       3,275       1,939       1,939       2,927       2,927       1,145       1,145          937
Giraud EVP       3,259       2,114       2,114       1,269    
Guthrie SVP
Holderness Former CFO       3,029       2,133       2,133       1,990       1,990       2,691       2,691       1,002  N/A   N/A 
Hyde SVP Exploration       3,021       2,114       2,114       1,399       1,399       2,904       2,904       1,141    
Beal Former President and COO  N/A   N/A 
 Totals      23,337     16,880     19,070     12,497     11,228     22,565     22,565       6,890       4,747       4,415
Annual % Change vs Prior Year 38.3% 52.6% -50.2% 227.5% 7.5%
5 Year Average Per Year % Change 55.1%
10 Year Average Per Year % Change 31.2%


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