Eight million dollars is a lot of money. In fact, "a lot" really doesn't do it justice. It's the kind of money that makes me think of Scrooge McDuck diving bill-first into a pool filled with gold, or Mr Burns cackling to himself in his mansion.

If someone told me that they wanted to give me a $8m pay check I'd laugh them out of the room. Short of curing cancer, what on earth could one person do that would justify being paid that kind of money?

Apparently, run Fonterra.

The news that Fonterra CEO Theo Spierings received a 75 per cent pay increase last year to take home a grand total of $8.32m caused a stir this week. The timing of the disclosure, after an election campaign filled with concerns about the financial wellbeing of farmers, couldn't have been much worse; although in a country that was built on a foundation of supposed egalitarian values, I doubt it'd be an easy pill to swallow at the best of times.

Advertisement

On the Fonterra website, the company describes itself as, "a global dairy nutrition company owned by 10,500 farmers and their families, united by a fundamental belief in the power of dairy to make a difference". I wonder how many of those families feel that $8.32m is an acceptable amount of money to pay a CEO?

How many Kiwi farmers would like a 75 per cent pay increase in a year when their profits fell by 11 per cent? Sounds like a pretty sweet deal, doesn't it? Indeed, the next time a baby boomer pipes up to give my generation a hard time for being the cohort that received certificates for participation, I'm going to direct their attention to Fonterra, where more than 4000 of its 18,000 staff earned at least $100,000 in the past year, even while its net profits fell by approximately $89m.

When you do the maths, the absurdity becomes particularly apparent. Those salaries alone total at least $400m (calculated at the lowest possible income level in that bracket - in reality, that number is much higher). Though talented staff are obviously required to run a successful business, and Fonterra's revenue was up during this past year, hard-working farmers could be forgiven for wondering whether staff costs are getting out of control.

Spierings' $8.32m windfall was made up of a combination of his salary and eye-watering bonuses. To put it into context, here's what $8m will buy you: one third of a flag referendum process, a small private jet, nearly 2.4 million native plants to plant around our waterways, or four average houses in Herne Bay.

Or, to put it another way, with $8.32m, you could afford to pay the yearly salaries of 170.49 Kiwis (going by the 2016 median income of $48,800). So, you could pay 170 and a half people an average salary, or you could pay Theo Spierings.

Just 20 years ago, chief executives earned much less than they do now. Otago University researcher Helen Roberts found that there had been a 228 per cent increase in the pay of company heads between 1997 and 2015. Perhaps even more troubling is Victoria University researcher Max Rashbrooke's contention that there is no evidence that CEOs are any more effective today when they're earning millions, than they were back in 1997 when the average NZX company Chief Executive's pay was a comparatively trifling $324,000.

I'm sure Spierings works hard. He's probably a nice man who is committed to his job - you'd certainly hope so, given the amount he is paid. But it is hard to think of his pay check as anything other than out of touch when many of the farmers who employ him are struggling. One Fonterra supplier farmer this week called RadioLIVE and put it this way: "My husband and I milk full time. I've had three days off in the past 12 months, and [my husband] hasn't had anything off in three years. We made three years of humungous losses ... then he turns around and he gets an $8m payout."

I don't actually have a problem with people working hard and being renumerated accordingly, but there are not enough hours in the day, nor days in the year, to justify $8m.

In my humble Kiwi-girl-from-Rotorua opinion, $8m for a CEO of a New Zealand company is obscene. It doesn't reflect the society I was raised in, and it certainly stands out rather starkly against a backdrop of a country where 295,000 Kiwi kids live in low income households (families that earn less than 60 per cent of the median income).

I don't want New Zealand to become a country where the super-rich get eye-watering pay checks and the poor struggle to raise their kids. Sadly, I fear we're well on our way to exactly that reality.

It is, of course, entirely possible that Spierings gives a significant percentage of his pay to charities or other worthy causes, although it is worth considering his own words on the well-publicised Milk in Schools programme. "It's a business decision," Spierings said in 2012. "I don't believe in charity."