On a list dominated by CEOs and executive chairmen, the fortune of Peter Meurs stands out.
He’s the director of development at Fortescue Metals Group (ASX: FMG), and owns $44.4 million worth of the Pilbara miner’s shares. That ranks him 42nd on this year’s BRW Executive Rich List, released today.
The list ranks the Australian executives who own the most shares in the companies they run. Meurs has only been at Fortescue since 2010, but is the only executive from Fortescue to make this year’s list. This is due to several high-profile Fortescue men retiring. After coming first on last year’s list with $6.23 billion worth of Fortescue shares, Andrew Forrest stepped down from his executive role, as did former executive director Graeme Rowley (who ranked 42nd on the list in 2010) and executive chairman Russell Scrimshaw (82nd).
Meurs has a history of being very personally invested in the companies he has worked for – far more than is usual for people who aren’t at the very top of the corporate hierarchy. He was a regular fixture on the executive rich list while at large engineering firm WorleyParsons. In 2010, he held $182.50 million of Worley’s shares while he was the head of its sustainable business operations branch. He ceased to be a significant shareholder in the same year, when he was headhunted by Fortescue.
The value of shares held by the 100 executives on the list plunged 38% this year – largely a result of a generational churn. As well as Forrest, Frank Lowy has stepped away from the management of Westfield Group, where he holds $1.6 billion in stock, impacting that result.
When the holdings of recurring directors on the list are considered in isolation from those of new entrants, the value of the list only fell 7%. This means the list outperformed the market, as the All Ordinaries lost 14% in the past year.
Not all iconic founders are stepping aside. First on the list is Rupert Murdoch, who owns $6.01 billion in News Corporation shares. The value of his holdings increased 7.5% on the year before, despite it being one of the most tumultuous years in the News Corp’s history. A phone-hacking scandal at News of the World saw him shut down Britain’s highest-selling and most profitable newspaper.
Astonishingly for such a struggling industry, the media widened its lead over all other sectors when it came to the value of personal holdings held by its executives. The result is largely due to the rise in Rupert Murdoch’s shares. The two Murdochs on the list (James Murdoch comes in at number 78) hold $6.024 billion worth of equity in News Limited.
The second industry judged by the value of the personal holdings of its executives was entertainment, with $4.8 billion.
Next came the energy and resources sector, whose executives held $3.3 billion worth of stock. Despite the centrality of the mining boom to Australia’s economy and the huge fortunes being made in it, the executives of publically-listed mining companies do not figure highly on the executive rich list. BHP Billiton’s Marius Kloppers owns only $26.8 million in BHP shares, making him number 57. Maybe he’s taking heed of the poor fortunes of uranium miner Paladin Energy, whose chief executive, John Borshoff, suffered a 64.6% fall in the value of his holdings after the Fukushima nuclear accident, which damaged the global demand for uranium. Two of Australia’s most personally invested mining executives, Gina Rinehart and Clive Palmer, do not figure on the list as they run private companies.
The only mining executive in the top 10 was Aquila Resources’ executive chairman Tony Poli, who owns $644.4 million worth of the miner’s shares. He was number six on the list, after coming 8th the year before. The value of his holdings declined by more than a quarter (or $200 million) in 2011, but the exit of several wealthy former executives pushed him up the ranks.
The list is compiled using the public disclosures of ASX300 companies.