In the face of an economic downturn and major layoffs at major German companies such as SAP, ThyssenKrupp and Bosch, executives at Germany’s top listed companies are earning more than ever before.
The remuneration of directors of companies listed on the DAX, MDAX and SDAX increased by an average of 11% in the 2023 financial year, according to a study by accounting firm EY that was published on Wednesday.
Including bonuses, they reached a record high of 2.65 million euros, according to the study. CEO salaries in particular rose sharply, rising by 16% to an average of €3.7 million.
At the same time, women on the boards of DAX, MDAX and SDAX companies continue to earn more on average than their male counterparts, although the gap is closing. According to the study, the incomes of male board members, excluding CEOs, increased by just over 9% to €2.26 million in 2023, while the salaries of female executives stagnated at €2.42 million, a marginal increase of 0. 1%.
Women on boards of directors are still a minority, but they are sought after. Many companies are looking for female managers, which increases salaries.
The analysis looked at the total direct remuneration, consisting of fixed salary and bonuses, of board members who were in office throughout the entire financial year.
According to EY, the pay of male board members at Germany’s top DAX-listed companies exceeded that of their female counterparts for the first time since 2015.
While men’s wages rose by an average of €260,000 in 2023, women’s wages fell by around €150,000. This meant that men had an advantage of approximately €290,000, with an average reward of approximately €3.3 million.
Several factors explain the salary increases
“The very positive salary development of many board members last year may at first glance be surprising, as DAX companies generally recorded rather stagnant revenues and profits,” said EY partner Jens Massmann.
However, he says there is a mixed picture. While some companies faced strong headwinds, other companies achieved strong profits. In addition, many companies link rewards to sustainability goals, regardless of their economic situation, and must also remain internationally competitive in the battle for top managers.
Recently, insurers have posted record profits and banks have benefited from rising interest rates. The highest-paid DAX CEO in 2023 came from the struggling automotive sector: Volkswagen CEO Oliver Blume earned around €10.3 million, according to the investor protection organization DSW. EY does not name any persons in its research.
