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Highlights
- Xero (XRO) has revised its CEO’s remuneration following notable company growth.
- The company's leadership recognizes the importance of aligning pay with performance benchmarks.
- Xero continues to achieve significant revenue growth and shareholder returns.
Xero (ASX:XRO), one of the leading technology companies on the ASX, has adjusted its CEO’s remuneration, citing significant business achievements and alignment with global benchmarks. Known for its accounting and business operations software, Xero has positioned itself as a top performer in the global software-as-a-service (SaaS) market.
The company’s board recently announced changes to the compensation structure for its CEO, Sukhinder Singh Cassidy, in recognition of her contributions since joining in November 2022 and assuming the CEO role in February 2023. The board emphasized the importance of incentivizing long-term value creation and aligning the CEO’s remuneration with market standards for global technology companies.
Under Cassidy’s leadership, Xero has consistently achieved revenue growth exceeding 20%. The company also improved its cash flow margin to 21%, achieving a "rule of 40" metric of 41% in FY24 and 43.9% in the first half of FY25. This metric combines revenue growth and profitability, reflecting Xero’s strong operational and financial performance.
From November 2022 to December 2024, Xero’s total shareholder return (TSR) reached 161%, a remarkable achievement in the competitive SaaS landscape. The board’s decision to update the CEO’s remuneration considered various factors, including performance, role scope, global benchmarks, and stakeholder feedback.
The updated package includes a reduction in the base salary and short-term incentive target from USD 735,000 to USD 540,000. Meanwhile, the long-term incentive target for FY26 has been increased to USD 14.1 million. Additionally, Cassidy will receive a one-time grant of 575,000 options with an exercise price of AUD 171.11, set to vest in three equal tranches.
Chair of Xero, David Thodey, highlighted Cassidy’s leadership in driving the company’s growth and profitability while attracting global expertise. Thodey emphasized that linking compensation to performance and retaining top talent in the competitive SaaS market remains critical to achieving Xero’s strategic aspirations.
Xero aims to solidify its position as a world-class global SaaS business by maintaining its focus on delivering shareholder value. The company’s impressive financial results and shareholder returns reflect its ongoing efforts to balance growth and profitability, bolstering its reputation as a high-performing technology leader on the ASX.
As Xero continues to navigate the competitive SaaS industry, its performance-driven approach and strategic leadership appear pivotal to sustaining its growth trajectory.
