Frankfurt, April 2019. CEO compensation levels in companies listed in the French lead index CAC 40 have experienced an annual growth of around 5% in 2017 compared to 2016. The increase is mainly due to higher payouts of annual variable compensation, which have on average risen from 1,225 k EUR in 2016 to 1,368 k EUR in 2017. Overall, this can be explained by a positive development in financial results – the net income of the CAC 40 constituents grew on average by 22% (Source: Thomson Reuters EIKON) between 2017 and 2016.

However, based on the analysis of CEO compensation in CAC 40 and STOXX companies in the financial years 2015-2017, average CEO compensation levels in France are continuously below the European average. While the average CEO total direct compensation (TDC)  in CAC 40 companies almost reached the 4.6 million EUR mark in 2017, STOXX CEOs received about 6.0 million EUR on average in the same year.

Figure 1. Average CEO total direct compensation (TDC) in kEUR and development of TDC in % in the CAC 40 and STOXX in 2015-2017

These are major results from an hkp/// group analysis based on data taken from the companies’ annual reports 2017 and from the previous fiscal years. The study analyzes the compensation of CEOs in companies in the French lead index CAC 40 and companies listed in the indices STOXX® Europe 50 and EURO STOXX 50® (STOXX companies). Only incumbents being full year in position are incorporated in the analysis.

“An explanation for the difference in CEO compensation levels can be found in the size of companies constituting both indices – the average revenue as well as market capitalization of STOXX companies exceed the respective values in the CAC 40 by 80% and 95%, respectively”, says Alena Vititneva, Consultant at hkp/// group. However, the differences are almost negligible, when the average headcount of the companies comprising both indices is compared.

CEO pay structures in France and Europe

The compensation structure of CAC 40 and STOXX CEOs is very similar to each other with variable compensation elements (STI & LTI) defining about 75% of total direct compensation in both European and French companies.

Figure 2. Average CEO compensation structure in the CAC 40 and STOXX in 2017


“This might be due to regulatory requirements for management board compensation by the Afep-Medef code in France as well as similar regulations in other European countries, e.g. the German Corporate Governance Code in Germany or the UK Corporate Governance Code in Great Britain, which recommend a predominantly multi-year assessment of variable compensation elements for Executive Directors”, explains hkp/// group Manager Verena Vandervelt.

The share of multi-year variable compensation (LTI) among STOXX companies is somewhat higher than in French companies, which is predominantly triggered by British and Swiss companies – these two countries traditionally have a strong share culture as well as favorable tax regulations for multi-year variable compensation.

CAC 40 CEO Ranking 2017

With a target direct compensation level of approx. 9.8 million EUR, which is more than twice as high as the index average, Sanofi’s CEO Olivier Brandicourt is the top earner among CAC 40 CEOs in 2017. This is primarily due to the large LTI grant made during the 2017 financial year, which exceeds the respective figure for the previous year by more than 2 million EUR.

Jean-Paul Agon, Chief Executive Officer of L'Oréal, is right behind the highest paid CEO and exhibits the largest base salary (2.2 million EUR) among his colleagues.

Top 3, Top 4 and Top 5 earners in the CAC 40 are represented by companies in the luxury and automotive industries. Carlos Ghosn (Renault) received a total direct compensation of more than 7 million EUR, whereby his annual variable compensation only accounts for 363 kEUR, as 75% of his bonus payout is deferred in shares. Carlos Tavares (PSA Peugeot Citroën) received about 6.7 million EUR, featuring the highest annual variable compensation payout among the analyzed CEOs, of which 1.0 million EUR being an exceptional compensation for the “PACE!” recovery plan for Opel Vauxhall.

The lowest target direct compensation figures in the CAC 40 range from 1.7 to 2.2 million EUR and mostly show a rather unusual compensation structure – multi-year variable compensation constitutes a smaller share of total direct compensation than is typical for CAC 40 companies.

Anton Frérot (Veolia Environment) has not been granted multi-year variable compensation in 2017, whereas Mr. Schnepp (Legrand) waived a portion of his variable compensation for 2017 in order to maintain it at the 2016 level. Mr. Petitcolin (Safran) is also member of the Board of Directors and additionally receives compensation for his Non-Executive role.


Figure 3. Ranking of the highest paid and the lowest paid CEOs in the CAC 40 in 2017; total direct compensation levels in EUR



hkp/// group is an independent, partner-managed international management consultancy that specializes in performance management, talent management and compensation. The company has offices in Frankfurt am Main, Amsterdam, Dordrecht and Zurich. The hkp/// partners have many years of international consulting experience and are renowned industry experts. They are valued as competent partners by boards of directors, supervisory boards and management boards, and by top executives and specialists. With compensation data for 700,000 executives, experts and employees in more than 60 countries and all major industries, hkp/// group, established in 2011, is one of the leading providers of compensation comparisons and benchmarks.



Author Verena Vandervelt

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