My praise and contempt for CEO actions is pretty well-known around these parts. I've been running a weekly series looking at CEO gaffes for nearly 10 months now (with seemingly endless material, may I add), and recently I've begun highlighting incredible CEOs who deserve a pat on the back. Last year I even listed my top 10 CEOs of the year and my 10 worst CEOs of the year.

However, this year we're changing things up a bit, and we're putting the ball in your court! This year, The Motley Fool community is going to decide who the best CEO of the year is, and which CEO should be banished to a distant island.

Each week, over the remaining four weeks, I'm going to highlight one CEO who's worthy of being the best CEO of 2012, as well as a CEO who could easily be called the worst of 2012. In total, you and your community members will have eight great CEOs and eight terrible ones to choose from when voting commences in November. For reference, here is last week's best CEO nominee.

In the meantime, I encourage you to get the discussion started on the "CEO of the Week" board. Although I do have all CEOs hand-picked already, these selections are by no means set in stone. If you can offer me your top picks for best and worst CEO, as well as your reasoning, you may just find your nomination in the spotlight.

Without further ado, I give you the fourth nominee for CEO of the Year: Randy Smallwood, CEO of Silver Wheaton (WPM -0.08%).

Why Randy Smallwood?

  • Positioned Silver Wheaton for success: Without question, it's been a difficult year for miners as many have struggled with rising labor and fuel costs, as well as weaker demand from China, and inflationary mine build-out costs. As for Silver Wheaton, it's just been cranking out ridiculous margins like it does every year, even with a few of its key contracted mines exhibiting production slowdowns and delays. The key to Silver Wheaton's success lies in the fact that it's a royalty interests company that supplies cash upfront to fund a mine's build-out in exchange for a percentage of the mine's production at a low-fixed cost. Furthermore, once the upfront payments are made, Silver Wheaton has no additional liability in mine maintenance costs. Based on Silver Wheaton's second-quarter average fixed cost of $4.06 per silver equivalent ounce, that means, based on the current price of silver, its operating margins are running close to $29 per ounce at the moment. 
  • Boosted Silver Wheaton's reserves far beyond its peers: In addition to delivering record quarterly returns, Silver Wheaton also boasts the largest silver reserves of any other miner, period! Its 798 million ounces of proven and probable reserves (worth $26.2 billion at current market prices for your information), are nearly double the next largest company. What's truly remarkable about its performance, is that it's record quarterly profits came while experiencing delays in Barrick Gold's (GOLD 0.71%) Pascua-Lama project, and lower production output in Goldcorp's (GG) Penasquito mine due to water issues.
  • Deal-maker extraordinaire: As should be evident by now, those executives who have graced Silver Wheaton's hallowed halls have been nothing short of phenomenal at garnering lucrative deals for the company and shareholders. Since taking the helm in April 2011 as CEO, Smallwood's biggest deal to date is his company's $750 million investment in Canada's Hudbay Minerals (HBM -1.14%). Specifically, Silver Wheaton will pay $500 million upfront to Hudbay, as well as two additional $125 million payments assuming capital expenditure requirements are met by Hudbay, in return for 100% of the silver production from Hudbay's 777 and Constancia mine, and 100% of the gold production at 777 until at least the of 2016. The negotiated per ounce price for these contracts: $5.90/oz. for silver and $400/oz. for gold. I have one word for that: genius!
  • Tied its dividend to its cash flow: Similar to Newmont Mining (NEM 1.22%) which was one of the first miners to tie its dividend to its previous quarter's cash flow, Silver Wheaton has been making waves with income investors by tying its dividend to its cash flow. This move allows investors to make an indirect investment in silver without owning physical silver itself – and what I mean by that is that as physical silver prices rise and fall, Silver Wheaton's dividend will rise and fall. Given that its quarterly payout has more than tripled from $0.03 to $0.10 in just the past five quarters, Silver Wheaton could be well on its way to becoming a dividend juggernaut.
  • Reasonable compensation package: Finally, you'd think with such a successful company that Randy Smallwood would be pilfering its piggy bank and rewarding himself for a job well-done. That's not the case one bit. Despite a 36% dividend-adjusted rise in the stock year-to-date in 2012 Smallwood took home an extremely reasonable $2.89 million in pay in 2011, consisting of a $663,808 salary, a well-deserved bonus of $737,475, and long-term compensation of $991,304. Keep in mind that Smallwood, as a co-founder of the Wheaton Group, has been with the company since 1993. Long-term executives and co-founders often align their interests with that of shareholders, and we're seeing a perfect example of that with Silver Wheaton.

Is Randy Smallwood the CEO of the year? That's going to be up to you and the rest of The Motley Fool community to decide. In the meantime, come back on Tuesdays and Thursdays for the next four weeks for the latest CEO nominations, and be sure to hit up the "CEO of the Week" board to voice your opinion to the community.