Monday, October 7, 2019

Columbus, Ohio-Based Metals Manufacturer Worthington Industries Inc's Top-Tier Executives Average Annual Pay and Employee Benefits Increase Was a Blistering 23.0% Per Year During the Past Ten Years

The third Democratic 2020 Presidential candidate debate was held in Houston, Texas on September 12, 2019.  The stickout strong performers in this debate were Amy Klobuchar, Pete Buttigieg, Beto O'Rourke and Cory Booker.  The only one of the Top Four candidates in the polls performing OK in this debate was Elizabeth Warren, with the other Top Three in the polls slipping in performance in this debate, especially two of them Kamala Harris and Bernie Sanders.

The most insightful recent move by the Democratic Presidential candidates is Pete Buttigieg's Bus, which is being driven now all over Iowa.  With this acquisition, Pete is showing his confidence in very effectively dealing with the media on a constant basis.  This move should eventually propel him into 3rd place in Iowa behind Elizabeth Warren and Joe Biden and give Pete a decent shot of eventually reaching the coveted 15% of Iowa's caucus vote.

The fourth Democratic 2020 Presidential candidate debate will be held on October 15, 2020 at Otterbein University in Westerville, Ohio, a Columbus suburb.  It's good to see that the New York Times will be one of the hosts.  The quality and relevance of the questions should improve substantially from what they were in the first three debates where the key economic issues played such a minor role.

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

While increasing the US federal minimum wage will help here, there is a much broader and critical problem that needs to be solved.  The annual percentage increase in the pay and employee benefits of Company non-executive employees are minuscule in relation to that of Company executive employees and this has been going on for decades.  When Corporate CEOs and CFOs primarily view non-executive employees as Costs rather than as People, this is what happens. And neither political party has had the courage to take on US Corporations here.

Thus I will be doing research and making posts on the average annual pay and employee benefits increase per year that the Top-Tier Executives of large Ohio Companies were rewarded with in the past ten years.

 The 48th Ohio Company I am addressing here is Worthington Industries Inc.

From annual compensation information contained in Company Proxy Statement filings with the US SEC, the chart at the bottom below shows Worthington Industries Inc's Top-Tier Executives Annual Total Compensation for each of the two consecutive full years of employment for the past ten years.
  
Worthington Industries Inc's Top-Tier Executives Average Annual Pay and Employee Benefits Increase was a blistering 23.0% per year during the past ten years, which is the 9th highest of the 48 large Ohio-related Companies I have addressed so far.

  1. TransDigm Group +243.1% per year for the past ten years
  2. Worldpay +49.0% per year for the past seven years
  3. Installed Building Products +34.9% per year for six years
  4. General Motors +29.5% per year for the past ten years
  5. Wendy's +24.2% per year for the past ten years
  6. Welltower +24.0% per year for the past ten years
  7. Cardinal Health +23.3% per year for the past ten years
  8. Timken Company +23.3% per year for the past ten years
  9. Worthington Industries +23.0% per year for the past ten years
  10. Cedar Fair L.P. +22.5% per year for the past ten years
  11. Cooper Tire & Rubber +22.4% per year for the past ten years
  12. MPLX LP +22.4% per year for the past five years
  13. RPM International +21.8% per year for the past ten years
  14. Scotts Miracle-Gro +21.5% per year for the past ten years
  15. Cintas Corp +20.7% per year for the past ten years
  16. Andeavor Logistics LP +20.6% per year for the past seven years
  17. Teradata +20.2% per year for nine years
  18. Cleveland-Cliffs +19.4% per year for the past ten years
  19. Multi-Color Corp +19.3% per year for nine years
  20. Marathon Petroleum Corp +18.7% per year for the past ten years
  21. Huntington Bancshares +18.4% per year for the past ten years
  22. Fifth Third Bancorp +18.0% per year for the past ten years
  23. STERIS plc +15.7% per year for the past ten years
  24. Nordson Corp +15.3% per year for the past ten years
  25. GrafTech International +14.9% per year for the past ten years
  26. American Electric Power +14.5% per year for the past ten years
  27. Forest City Realty Trust +13.2% per year for seven years
  28. Eaton Corp plc +12.7% per year for the past ten years
  29. Cincinnati Financial +12.3% per year for the past ten years
  30. Progressive Corp +12.1% per year for the past ten years
  31. Sherwin-Williams +12.0% per year for the past ten years
  32. Parker-Hannifin +12.0% per year for the past ten years
  33. The Kroger Company +11.2% per year for the past ten years
  34. FirstEnergy +10.2% per year for the past ten years
  35. TFS Financial Corp +10.2% per year for nine years
  36. KeyCorp +9.8% per year for the past ten years
  37. Chemed Corp +9.7% per year for the past ten years
  38. PolyOne Corp +9.1% per year for the past ten years
  39. J. M. Smucker +8.8% per year for the past ten years
  40. Dana Inc +8.4% per year for the past ten years
  41. Lancaster Colony +8.0% per year for the pat ten years
  42. Lincoln Electric Holdings +7.6% per year for the past ten years
  43. American Financial Group +7.6% per year for the next ten years
  44. Procter & Gamble +7.4% per year for the past ten years
  45. Macy's +6.6% per year for the past ten years
  46. Owens Corning +6.3% per year for the past ten years
  47. Goodyear Tire & Rubber +5.4% per year for the past ten years
  48. L Brands +2.0% 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 including the year after year after year of annual furtive tax extenders of predominately special interests additional tax loopholes, which both the Democratic and Republican Establishments voted for, but none more income inequality expanding 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 Ohio has such massive continuing Income Inequality Expansion ..... it appears to be predominantly about the relative long-term annual pay and employee benefits percentage increases 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 and Employee Benefits Raises, the US Government should step in and pass wisely-designed, simple but effective Fair Pay Raise Income Inequality Narrowing Company tax incentives for Companies which reward non-executive employees with fair pay increases ..... the carrot ..... and Company tax disincentives for Companies which reward executive employees with clearly excessively high pay and employee benefits 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.

The above Fair Pay Raise Tax proposal could also be applied to US Non-Profit Organizations like Hospitals and other Health Care Organizations, which are known for their huge and continuing income inequality expansion due to their discriminating policies on annual pay and employee benefit increases.  

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
May May May May May May May May May May
Worthington Industries 2019 2018 2018 2017 2017 2016 2016 2015 2015 2014
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
McConnell CEO           3,739           4,428           4,428           4,585           4,585           4,152           4,152           4,172           4,172           4,701
Rose President and Former CFO           6,499           2,698           2,698           2,756           2,756           2,411           2,411           2,332           2,332           6,649
Gilmore COO           5,395           3,005           3,005           1,793           1,793           1,627           1,627           2,291           2,291           1,545
Winland SVP Manufacturing           1,257           1,417           1,417           1,453           1,453           1,259    
Russell Former COO  N/A   N/A            2,882           2,958           2,958           2,604           2,604           2,490           2,490           7,073
Lamprinakos FmrPres WashingtonSteel  N/A   N/A            1,389           1,821    
Billman President WorthingtonCylinder           2,237           1,570
 Totals      16,890     11,548     15,819     15,366     13,545     12,053     10,794     11,285     13,522     21,538
Annual % Change vs Prior Year 46.3% 2.9% 12.4% -4.4% -37.2%
5 Year Average Per Year % Change 4.0%
FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE
May May May May May May May May May May
Worthington Industries 2014 2013 2013 2012 2012 2011 2011 2010 2010 2009
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
McConnell CEO           4,701           4,587           4,587           3,974           3,974           3,547           3,547           3,084           3,084           1,848
Rose Former CFO           6,649           2,289           2,289           5,276           5,276           1,377           1,377           1,124  N/A   N/A 
Gilmore COO  N/A   N/A     
Winland SVP Manufacturing               982           1,167           1,167           1,424    
Russell Former COO           7,073           2,590           2,590           5,704           5,704           1,702           1,702           1,639           1,639               730
Lamprinakos FmrPres WashingtonSteel
Billman President WorthingtonCylinder           1,570           1,424                            
Stoe Former COO           2,066           2,875           2,875           2,499           2,499           2,111           2,111           1,313
Goussetis Pres Worthington Cylinder           1,083               939               939               795
 Totals      19,993     10,890     12,514     18,996     18,996     10,549     10,208       8,897       7,773       4,686
Annual % Change vs Prior Year 83.6% -34.1% 80.1% 14.7% 65.9%
5 Year Average Per Year % Change 42.0%
10 Year Average Per Year % Change 23.0%


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