Ever Wonder How Much Kroger's Financial Maestro Takes Home? Let's Find Out!
Have you ever looked at a massive company like Kroger, with its sprawling grocery empire, and wondered about the financial wizardry behind it all? Specifically, the person who holds the purse strings – the Chief Financial Officer (CFO)? It's a role of immense responsibility, managing billions in revenue, expenses, and investments. So, how much does the CFO of Kroger actually make? Prepare to be enlightened, because we're about to dive deep into the fascinating world of executive compensation at one of America's largest retailers!
Understanding the compensation of a top executive like a CFO isn't as simple as just a single number. It's a complex package that includes various components, designed to incentivize performance and align interests with shareholders. Let's break it down step-by-step.
Step 1: Grasping the Basics of Executive Compensation
Before we pinpoint Kroger's CFO salary, it's crucial to understand the typical components that make up an executive's pay package at large public companies. It's a delicate balance of fixed pay and performance-based incentives.
1.1 Base Salary: The Foundation
This is the fixed portion of the CFO's compensation, paid regularly, typically on a bi-weekly or monthly basis. While it's a substantial amount, it usually represents only a fraction of the total compensation for a high-ranking executive. Think of it as the stable ground upon which the rest of the compensation structure is built.
1.2 Annual Incentive Bonus: Performance in the Short Term
This component is tied to the company's performance over a single fiscal year. It's often based on metrics such as:
Revenue growth: How much the company's sales increased.
Operating profit: The profit generated from the company's core operations.
Earnings per share (EPS): A key indicator of a company's profitability from the perspective of its shareholders.
Individual performance goals: Specific objectives set for the CFO, such as optimizing cash flow or achieving cost efficiencies.
The payout can vary significantly, ranging from zero if targets aren't met, to well over the target if performance is exceptional.
1.3 Long-Term Incentive (LTI) Awards: Sustained Success
This is often the largest and most significant portion of executive compensation, designed to reward sustained performance over several years (typically three to five). LTIs are usually granted in the form of equity, such as:
Stock Options: Gives the CFO the right to purchase company stock at a predetermined price in the future. The value comes from the stock price increasing over time.
Restricted Stock Units (RSUs): These are promises to deliver company stock to the CFO after a certain vesting period, usually contingent on continued employment and sometimes performance metrics.
Performance Share Units (PSUs): Similar to RSUs, but the number of shares ultimately received depends on achieving specific long-term performance targets (e.g., total shareholder return relative to peers, long-term profit growth).
The idea behind LTIs is to align the CFO's financial interests directly with the long-term success and shareholder value of Kroger. If the company thrives, the CFO's long-term awards become substantially more valuable.
1.4 Other Compensation and Perks: The "Fringe" Benefits
While not as large as the primary components, these can still add up. They include:
Perquisites (Perks): Things like company car allowances, personal use of company aircraft, executive financial planning, and club memberships.
Retirement Benefits: Contributions to executive retirement plans, which can be significant.
Deferred Compensation: The ability to defer a portion of their salary or bonus to be paid out at a later date, often for tax planning purposes.
Step 2: Pinpointing Kroger's CFO Compensation - The Latest Data
Now that we understand the compensation puzzle, let's look at recent disclosures for Kroger's CFO. Keep in mind that executive compensation data is typically disclosed in a company's annual proxy statement (filed with the SEC) for the most recently completed fiscal year. As of July 2025, the most relevant information available would pertain to fiscal year 2024 (which ended around February 2025).
Kroger appointed David Kennerley as its Senior Vice President and Chief Financial Officer, effective April 3, 2025. Prior to this, Todd Foley served as the Interim Chief Financial Officer. Therefore, the compensation data for fiscal year 2024 would likely reflect Todd Foley's compensation for his time as Interim CFO, and potentially, information regarding David Kennerley's initial compensation package.
According to recent SEC filings, here's a breakdown of the compensation components for Kroger's CFO:
2.1 For the New CFO (David Kennerley, effective April 3, 2025):
Annual Base Salary: $800,000
Annual Incentive Bonus Target: $800,000 (meaning he's eligible for up to this amount, depending on performance)
One-time Cash Bonus Payment: $1.35 million, paid on a predetermined schedule over his first year of employment. This is an initial incentive to join the company.
One-time Grant of Stock Awards: $2.8 million in equity, likely vesting over several years. This is a significant component of his initial long-term compensation.
2.2 For the Former Interim CFO (Todd Foley, for fiscal year 2024):
Total Compensation (Fiscal Year 2024): Approximately $4,039,420
Total Cash: $1,956,380
Equity: $2,000,015
Other: $83,025
It's important to note that Todd Foley's compensation as Interim CFO may differ from the compensation of a permanent CFO, as his role was transitional. The incoming CFO, David Kennerley, has a structured compensation package outlined above, which will be fully reflected in future proxy statements once a full fiscal year of his tenure is completed.
Step 3: Understanding the "Why" Behind the Numbers
Why do CFOs, and executives in general, command such high compensation? It's a question often asked, and the answer lies in several factors:
3.1 Scarcity of Talent: A Specialized Skillset
Being a CFO of a multi-billion dollar corporation like Kroger requires a highly specialized and rare skillset. These individuals are responsible for:
Managing complex financial operations across a vast enterprise.
Strategic financial planning and capital allocation.
Risk management and compliance.
Investor relations and communication with the financial markets.
Leading large finance teams.
There's a limited pool of individuals with the experience, expertise, and leadership qualities necessary to effectively manage such a critical function at this scale.
3.2 Impact on Company Performance: Direct Influence on Value
The CFO's decisions directly impact the company's financial health and, consequently, its shareholder value. A skilled CFO can:
Optimize financial performance.
Identify growth opportunities.
Improve efficiency and profitability.
Navigate economic challenges.
Their performance can literally add or detract billions from a company's market capitalization. The compensation aims to reflect this direct impact.
3.3 Competitive Landscape: Attracting and Retaining Top Talent
Companies compete fiercely for top executive talent. If Kroger wants to attract and retain the best financial minds, they need to offer compensation packages that are competitive with other major corporations, both within and outside the retail sector. Compensation committees at public companies often benchmark their executive pay against a peer group of similar-sized companies.
3.4 Fiduciary Duty: Protecting Shareholder Interests
The CFO holds a significant fiduciary duty to the company and its shareholders. Their decisions must be made with the best financial interests of the company in mind. The compensation structure, particularly the long-term equity awards, is designed to align the CFO's personal financial success with the long-term financial success of Kroger and its shareholders.
Step 4: Delving into the Nuances of Compensation Structure
It's not just about the total number; the structure of the compensation is equally important.
4.1 Pay-for-Performance Philosophy: Skin in the Game
As seen with the significant portion of compensation coming from annual bonuses and long-term incentives, Kroger's executive compensation philosophy is heavily geared towards "pay-for-performance." This means a substantial portion of the CFO's potential earnings is at risk and dependent on the company's financial results and stock performance. This encourages the CFO to make decisions that drive sustainable growth and profitability.
4.2 Transparency and Disclosure: Public Scrutiny
As a publicly traded company, Kroger is legally required to disclose the compensation of its top executives in its annual proxy statements. These documents, filed with the U.S. Securities and Exchange Commission (SEC), provide a detailed breakdown of all compensation components. This transparency allows shareholders and the public to scrutinize executive pay and hold boards accountable. You can typically find these reports on Kroger's investor relations website or the SEC's EDGAR database.
Step 5: The Evolution of CFO Compensation
Executive compensation, including that of CFOs, is not static. It evolves based on market trends, regulatory changes, and company performance. In recent years, there has been an increased emphasis on:
ESG (Environmental, Social, and Governance) Metrics: Some companies are starting to incorporate ESG targets into executive compensation plans, though this is still less common for CFOs than for CEOs.
Shareholder Activism: Shareholders are increasingly vocal about executive pay, pushing for greater alignment between pay and performance, and scrutinizing excessive compensation.
Economic Climate: During challenging economic times, executive compensation, particularly bonuses, may be reduced to reflect company performance.
The role of the CFO itself is also evolving, moving beyond traditional accounting and finance to encompass more strategic leadership, technological integration, and data analytics. This expanded scope can also influence compensation levels.
Conclusion: A Multifaceted Picture
The question of "how much does the CFO of Kroger make" doesn't have a simple, static answer. It's a dynamic figure, composed of a base salary, performance-driven bonuses, and substantial long-term equity awards. For the incoming CFO, David Kennerley, his initial package includes an $800,000 annual base salary, an $800,000 target annual bonus, a $1.35 million one-time cash bonus, and $2.8 million in one-time stock grants. For the prior Interim CFO, Todd Foley, his total compensation for fiscal year 2024 was approximately $4 million. These figures reflect the immense responsibility, specialized skills, and market competitiveness involved in leading the financial operations of a retail giant like Kroger. It's a compensation structure designed to attract top talent and incentivize performance that ultimately benefits the company and its shareholders.
Frequently Asked Questions about Executive Compensation at Kroger
Here are 10 related FAQ questions with quick answers to help you further understand executive compensation at Kroger:
How to find Kroger's executive compensation reports?
You can find Kroger's executive compensation reports, including detailed breakdowns for the CFO, in the company's annual proxy statements (Form DEF 14A) filed with the U.S. Securities and Exchange Commission (SEC). These are typically available on Kroger's investor relations website under "Financials" or "SEC Filings."
How to understand the difference between salary and total compensation?
Salary is the fixed, regular payment an executive receives. Total compensation is a much broader figure that includes base salary, annual bonuses, the value of long-term equity awards (like stock options and restricted stock units), and other benefits and perks.
How to interpret "performance-based" compensation?
Performance-based compensation, such as annual bonuses and long-term incentives, means that the actual payout depends on how well the company (and sometimes the individual executive) achieves pre-defined financial or operational targets. If targets are missed, the payout might be reduced or eliminated; if exceeded, it could be higher.
How to compare Kroger CFO's compensation to other retail CFOs?
To compare, you would need to look up the proxy statements of other large retail companies (e.g., Walmart, Target, Albertsons) and examine their CFOs' total compensation for the same fiscal year. Industry averages and compensation surveys can also provide benchmarks.
How to know if the CFO's compensation is "fair"?
Assessing fairness is subjective, but it generally involves comparing the compensation to the company's performance, shareholder returns, and the compensation of CFOs at peer companies. Governance experts and some shareholders may also consider the ratio of CEO/CFO pay to the median employee's pay.
How to understand the impact of stock awards on total compensation?
Stock awards are typically valued at the time they are granted. Their ultimate value to the CFO depends on the company's stock price performance over the vesting period. If the stock price increases significantly, the value of these awards can grow substantially.
How to determine the "fiscal year" for compensation reporting?
Kroger's fiscal year ends on the Saturday closest to January 31. So, for example, fiscal year 2024 would generally cover the period from February 2024 to January/February 2025. Compensation reported in the 2025 proxy statement would be for fiscal year 2024.
How to find information on past Kroger CFOs' compensation?
Past compensation data for former Kroger CFOs can be found in previous years' proxy statements available on Kroger's investor relations website or the SEC's EDGAR database.
How to understand the role of the Compensation Committee?
Kroger's Board of Directors has a Compensation Committee, typically composed of independent directors. This committee is responsible for reviewing, approving, and overseeing the company's executive compensation philosophy, plans, and awards, ensuring they align with company strategy and shareholder interests.
How to learn about the "clawback" provisions in executive compensation?
Many companies, including Kroger, have "clawback" provisions in their executive compensation plans. These provisions allow the company to reclaim incentive-based compensation (bonuses or equity awards) from executives if it's later determined that the compensation was based on erroneous financial results or if the executive engaged in misconduct.
