The average remuneration of bosses of companies in the flagship CAC 40 stock index, according to its composition as of June 30, 2023, fell by almost 15% in 2022, to 6.7 million euros, according to a report published this Tuesday November 21 by the Proxinvest firm. But this drop is “illusory”, warns Jehanne Leroy, editor of the report during a videoconference with the media.
The year 2021 was marked by “a Carlos Tavares effect”, named after the general director of the Franco-Italian-American automobile group Stellantis who had obtained record remuneration, more than 66.7 million euros according to Proxinvest (19, 15 million according to the company), due to exceptional elements. It fell to 19.6 million euros in 2022.
The average remuneration of CAC 40 bosses up 29% since 2019
Compared to the year 2019, judged to be more representative than 2021 and 2020, where the pandemic had pushed certain managers to give up part of their income, “the average remuneration increases by 29%” on the CAC 40, notes Jehanne Leroy .
On the expanded SBF 120 index, which brings together the 120 largest companies listed on the Paris Stock Exchange, including that of the CAC 40, the trend is the same with a drop of 6% over one year, to 4.2 million euros. euros in average remuneration. The increase is 14% compared to 2019. Excluding 2021, “average total compensation across all indices is the highest in 16 years,” according to the report. In total, 9 managers receive more than 10 million euros, a record.
“On the one hand, companies have become increasingly larger and multinational, so the increase in their scope of action results in the remuneration of their managers increasing,” Henri Sterdyniak, an economist at the French Observatory of Economic Conditions (OFCE). On the other hand, the good health of the stock market counts for a lot because part of their remuneration is indexed to the company’s stock market performance.”
A CAC 40 manager earns, on average, 89 times more than his employees. And even though the figure is down from 110 times in 2021, it remains the highest compared to other years. The ratio was 72 in 2014. Since 2014, the remuneration of bosses (+ 62%) has increased twice as fast as that of employees (+ 31%). For economist Henri Sterdyniak, the business leader “is rewarded for his good performance”. Depending on the case, “we can consider that these performances are linked either to the good health of the company or to purely financial operations”.
Greater respect for the limitation of bonuses to 150% of the fixed salary
Executive remuneration is made up of a fixed salary, a variable part but above all the allocation of shares, which represents almost half of the income. Proxinvest, which gives voting recommendations to shareholders during general meetings of companies, also underlined greater respect for its recommendations on the limitation of bonuses to 150% of the fixed salary, but also greater contestation of “departure packages “, having notably concerned the directors of Atos, Schneider Electric, Société Générale and Seb.
The top trio of highest paid executives is made up of Bernard Charlès of Dassault Systèmes (33 million euros), Daniel Julien of Teleperformance (19.7 million euros) and Carlos Tavares (19.6 million euros). euros). Bernard Charlès’ remuneration, mainly in shares, “compensates for the past” and “makes up for the years” during which the manager had no remuneration linked to the situation of the company, explains Jehanne Leroy. Next year, the arrival of a new general director, “who has benefited throughout his career” from incentive measures, remuneration “should be more in line”, she underlines.
François-Henri Pinault, CEO of Kering, receives 13.7 million euros according to Proxinvest, which includes “an assistance agreement” of 7.2 million euros signed with Artémis, the family’s holding company. Pinault. The report takes into account all forms of executive remuneration: fixed, annual bonus, tokens, benefits in kind, stock options and free performance shares valued on their grant date, cash incentives and other indirect forms of compensation. remuneration. Figures may differ from data reported by companies.
The increase in these remuneration appears inevitable, unless a crisis situation arises. “The remuneration of a CEO is also a signal sent to shareholders: the company is in good health because it has the means to pay for a “luxury” CEO and this shows that its strategy is validated, analyzes Henri Sterdyniak. It’s a showcase that helps attract new shareholders.” A more recent mechanism in France but already well established in the United States. Across the Atlantic, the average difference between boss pay and employee pay stands at 186, according to an analysis of the MyLogIQ index and published by the Wall Street Journal in 2022.