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Stellantis CEO Carlos Tavares holds a news conference after meeting with unions, in Turin, Italy, March 31, 2022. — Reuters pic
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PARIS, April 13 — The massive pay package of the CEO of US-European automaker Stellantis was blasted by some shareholders and crept its way into the French presidential campaign today.
Stellantis says CEO Carlos Tavares is due to receive €19 million (RM87 million) 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 €2 million, Tavares is to get €7.5 million in performance-based pay, €2.4 million in retirement contributions and a €1.7-million bonus related to the success of the merger.
He will also receive €5.6 million worth of company shares, according to Stellantis.
But activist investor group Phitrust voted against the remuneration yesterday, saying that, according to its own calculations, Tavares could get as much as a whopping €66 million in cash and shares — a figure rejected by Stellantis as “wrong”.
“These are obviously not normal figures,” said government spokesman Gabriel Attal.
“We must continue to act at the European level,” he said, 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 the first round on Sunday.
Stellantis, which was holding its annual shareholder meeting today, posted a net profit of 13.4 billion euros for 2021 despite the car industry seeing its recovery from the Covid-19 crisis crimped 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”.
The group questioned whether the pay package was “justified for a person who is not the creator of the company, but is only its manager and therefore does not take any risk or financial penalty or assume any personal responsibility, especially as the merger of the two groups is not yet completed?”.
It also asked whether such remuneration was socially justified given that Stellantis was likely to need cut jobs due to overcapacity following the merger.
The CFDT union said the compensation package was “hard to swallow for employees who are asked to make competitiveness efforts every day”. — AFP