PARIS: The massive pay package of the CEO of US-European automaker Stellantis was blasted by shareholders and crept its way into the French presidential campaign on Wednesday. In a purely consultative vote, they narrowly voted against the 19-million-euro ($20.6 million) pay package for CEO Carlos Tavares.
The head of the company’s board, John Elkann, said the company’s pay policy adopted by over 87 percent of shareholders last year was to “compensate the performance” of top executives. The pay package is for 2021, the year that France’s PSA (Peugeot-Citroen-Opel) and Italian-American group Fiat-Chrysler merged to form the world’s fourth largest automaker.
Beyond his base salary of two million euros, Tavares is to get 7.5 million euros in performance-based pay, 2.4 million euros in retirement contributions and a 1.7-million-euro bonus related to the success of the merger.
He will also receive 5.6 million euros’ worth of company shares, according to Stellantis.
But activist investor group Phitrust voted against the remuneration on Tuesday. According to its calculations, it said, Tavares could get as much as a whopping 66 million euros in cash and shares — a figure rejected by Stellantis as “wrong”.
“These are obviously not normal figures,” said French government spokesman Gabriel Attal.
“We must continue to act at the European level,” he added, citing efforts to impose a minimum tax on big companies or promoting profit-sharing.
Far-right French presidential candidate Marine Le Pen was also drawn into the issue, saying: “It’s shocking, but less shocking than for others.
“For once he obtained good results,” said Le Pen, who is facing President Emmanuel Macron in a runoff on April 24 after finishing second in Sunday’s first-round vote.
Stellantis, which was holding its annual shareholder meeting on Wednesday, posted a net profit of 13.4 billion euros for 2021 despite the car industry seeing its recovery from the Covid-19 crisis cramped by a shortage of semiconductors.
Activist investor group Phitrust, a minority shareholder, took issue with the valuation of the stocks granted to Tavares.
It said that if calculated using the methodology of French market regulators “the total amount of the remuneration of the CEO of Stellantis granted for 2021 would amount to 66 million (euros)”.