Carlos Tavares Gets His Controversial Salary Confirmed By His Shareholders: ‘If You Think It’s Unacceptable, Get The Law’

A non-binding but closely-scrutinized vote: Stellantis shareholders, who met at a general meeting on Tuesday 16 April, approved with 70.2% of the votes the remuneration of the group’s CEO, which could reach 36.5 million euros by 2023. 23.5 million euros in 2022 and 19 million euros in 2021, according to the company’s annual financial report.

The increase in his salary is mainly related to the payment of a bonus of 10 million euros “transformation” of the group created in 2021 by the merger of PSA and Fiat-Chrysler. Mr. Tavares’ pay, 65, includes retirement pensions that will be paid out over the long term, but also bonuses given only if he hits targets by 2025, the final year of his current mandate at the helm of the manufacturer.

For the 2023 financial year, Mr. Tavares will initially receive €23.5 million. Paid mainly in shares, this remuneration also increases with the value of the group’s shares, which have almost doubled in the past three years. Unlike what would happen if Stellantis were headquartered in France, the shareholder vote will be purely advisory, with the company governed by Dutch law.

On a trip to the Tremer factory (Moselle) on Monday, Mr. Tavares picked up this paycheck. “The contractual dimension between me and the company as a footballer and a Formula 1 driver”. “Ninety percent of my salary comes from the results of the company. (…) So this proves that the company’s results are clearly not that bad.”– responded Mr. Tavares at the microphone of France Bleu Lorraine Nord, adding: “If you think this is unacceptable, make a law and change the law and I respect it. »

In this process, the president of the socialist group of the National Assembly Boris Valo said on his account that he intended to re-introduce a bill aimed at closing the business income gap. The text, first introduced in 2020, also calls for the government to submit a report to parliament. “Assess the need for changes in European legislation related to transparency and the regulation of pay gaps in companies headquartered in one of the EU member states”As is the case with Stellantis. “We can agree with Mr. Tavares on one point: this is a policy that can set a decent limit on income gaps.”assessed Mr. Valo.

“Shocking and scandalous” for the CGT

With its 14 brands including Peugeot, Citroën, Fiat, Dodge and Opel, Stellantis on February 15 posted a new record profit of 18.6 billion euros for 2023, up 11% year-on-year. Its turnover is close to 190 billion euros.

Several investment advisory firms still recommended voting against this year, including US agency Glass Lewis, which issued “serious reservation”. “Compensation is excessive even in this context”ISS (for International Shareholder Services) was also informed in a note that the world consulted.

For its part, the General Confederation of Labor (CGT) of Stellantis criticized the salary. “Totally shocking and scandalous” equivalent to 100,000 euros per day, “An increase of almost 50% when most of us only had 3.7% and are struggling to make it through the month”. The major automotive group announced on February 15 that it will distribute almost 1.9 billion euros to its employees worldwide. In France, it’s at least €4,100 for the lowest wage – up from €4,300 in 2023, despite Stellantis’ higher earnings this year. The group’s shareholders, in turn, will receive around 7.7 billion euros for the 2023 financial year, between dividends and the share buyback program.

The remuneration of the Director General has already been criticized in 2022, in particular by the President of the Republic, Emmanuel Macron, who discussed it between two rounds of presidential elections. “shocking and overwhelming” quantity “Astronomical” his pay. Stellantis argues that this pay should be more comparable to multinational companies such as Boeing in the United States (Dave Calhoun, $33 million by 2023). The group actually makes most of its sales in Europe, but derives most of its profits from the American market.