Marysville, Ohio-based Scotts Miracle-Gro appointed Matthew Garth, 48, to the roles of CFO and executive vice president, effective Dec. 1., the company announced this week.
Garth, who was previously CFO of New York City-based Minerals Technologies, has more than 25 years of financial experience, including 14 years at Alcoa, Inc., where he held numerous senior financial roles. He is the lawn-care company’s second CFO in as many years and will replace David Evans, a member of the company’s board who was named interim CFO in August.
Garth’s compensation includes an annual base salary of $725,000, and a sign-on bonus of $700,000 to be paid in two installments made in January and July 2023, as well as a sign-on equity award in restricted stock with a grant date value of $750,000 on Dec. 1., according to a company filing Monday. The RSUs will vest over two years after the grant date.
While signing or new-hire bonuses have long been used as a tool to attract executives, experienced CFOs are enjoying a strong negotiating position thanks in part to a record number of initial public offerings last year that increased demand for executives with public company experience.
Garth’s sign-on bonus is dwarfed by the value of some recent bonuses handed out by some mega-cap companies. Digital payments giant PayPal Holdings awarded its then new CFO Blake Jorgensen a $6 million new hire cash bonus in August, and earlier this year retail giant Walmart included a $5 million signing bonus in its new finance chief John Rainey’s compensation package.
Executive search experts agreed that Garth’s bonus underscored the current strong demand for talent.
Josh Crist, co-managing partner with Crist|Kolder Associates, wrote in an email that Garth’s bonus was “on par with what multi-billion organizations have to do to attract world-class talent right now. This is a $4 billon consumer-facing publicly traded company. I view this deal as fair for both sides.”
In contrast, Shawn Cole, president of the executive search firm Cowen Partners, wrote in an emailed response that the sign-on bonus Scotts gave is rich for a company of their size but “speaks to the current market and short supply of experienced public company CFOs. They clearly wanted him.”
Garth’s experience and background in financial planning and analysis (FP&A) and investor relations contrasts with the accounting and auditor background of the company’s former CFO, Cory Miller, who stepped down from the role in August, Cole said. “This speaks to the current financial outlook…they need forecasting experience and a CFO who can communicate a plan. Garth is what we call a ‘modern CFO’ with less emphasis on the past (reporting) and more on the future (forecasting),” Cole stated.
Scotts Miracle-Gro is one of the many businesses that have been impacted recently by the rapid shift from inventory shortages to glut, according to a Sept. 15 Wall Street Journal report. After working to meet customer demand for lawn seed and fertilizer early in the pandemic, the company ramped up production to meet demand but the expected orders never came, the report stated.
Scotts did not respond to requests for comment.