I think it is fair to say that Shaw Communications Inc. is notorious for its executive pension plan, given the headlines in 2010 that retiring CEO Jim Shaw would receive a $5.9-million annual payment. The company said in late 2012, however, that it would take a number of measures that would have the effect of limiting its executive-pension issues.

The latest numbers are in and the results are, well, "mixed" might be too polite.

In a recent securities filing, Shaw says that its total obligations under its supplemental executive retirement plan were $487-million at the end of the company's fiscal year in August. That's up 20 per cent from the year before and up 46 per cent from the end of fiscal 2011, the last full year before Shaw amended the plan.

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The company said in 2012 it would put $300-million into the plan, a rare move in a world where companies rarely pre-fund their executive pensions and instead pay benefits each year out of their cash flow. But while that payment meant just $102-million of liabilities were unfunded in August, 2013, the plan was $159-million short 12 months later.

These are pretty remarkable numbers for a pay plan that was instituted in September, 2002, and closed to new members in just under 10 years. There are just 15 beneficiaries of this plan who have accumulated the $487-million, including company founder JR Shaw and his two sons, Jim and Bradley, the company's current CEO.

What's the problem? Well, Shaw deserves some credit for making changes since my column of December, 2011, "The relentless rise of Shaw Communications' executive pay."

The company had been comparing its pay to a "peer group" of 25 companies that were much larger than Shaw in terms of revenue and market value and which would naturally pay their executives much more. Since then, Shaw has changed its peer group to a much more reasonable bunch; Shaw's market value, as of this week, is actually above the median of the peer group. Bravo.

Also, Shaw's pension changes included a tweak to the formula in which the salary used to calculate the pension would be frozen at the 2012 level. That change actually reduced the compensation-driven value of the estimated payouts. The company reported a value of negative $6.6-million for Bradley Shaw's total compensation in 2012 because the estimated pension value declined by nearly $14-million as a result of the changes, rather than increasing, that year.

The overarching issue with the company's compensation, however, remains the same as in my 2011 critique. Shaw's outsized bonuses drive the pension costs, since the annual incentive payment is included in the pension calculation. JR Shaw's contract provides for an annual bonus of between 0.5 per cent and 1 per cent of the company's operating income before restructuring costs and amortization. (The company must meet its financial targets for the bonus to be paid.)

As I said in 2011, and is even more true today, that plan is more suitable for a small company, not the multibillion-dollar concern Shaw has become. JR Shaw's 2014 bonus of $11.15-million, up from $10.1-million in 2013, was the minimum payment of 0.5 per cent of operating income. (Should we congratulate the company for not paying him the $22-million he could have received at the upper end of the range?)

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All told, the five best-paid Shaw executives received $34.4-million in bonuses in 2014, up nearly 47 per cent in two years. Those bonuses, combined with changes in assumptions about interest rates and other estimates, have caused Shaw's pension obligation to swell.

And, two more important points can be made once again. One, JR Shaw, his two sons, and their families own $1.7-billion in Shaw shares, both voting and non-voting. They have increased in value by $500-million since the end of the 2011 fiscal year, and they pay roughly $50-million per year in dividends. Some companies have managers richly compensated for building shareholder wealth; others are run by founders who profit when the value of their holdings increase. The Shaws have it both ways. (At least we can note that the company eschews stock options, unlike most cable firms, specifically citing the Shaw family's equity ownership.)

And, two, most of the public Shaw shareholders, who own the company's non-voting shares, have little say on the matter, since a 'say on pay' vote is not forthcoming. Shaw stock has beaten the S&P/TSX composite over the five years ended in August, so there's no imminent shareholder revolt. But Shaw shares can always reverse course; its executive pensions have nowhere to go but up.