Publication in Corporate Finance 9/2015

After significant increases in 2013, executive compensation for DAX and MDAX companies also increased in 2014. Im Mehrjahresvergleich gibt es eine positive Korrelation mit der wirtschaftlichen Entwicklung der Unternehmen. In relation to EBIT, it can be seen that the top performers pay rather below average in terms of the absolute level of remuneration. The model tables according to the DCGK have led to a significant increase in transparency.

I. Introduction

Against the background of the financial crisis in 2008, the
Federal Government adopted the Act on the Adequacy of Executive Board Remuneration (VorstAG) on 05.08.2009 in order to influence the remuneration structure of board members. In addition to the legal requirements, the recommendations of the German Corporate Governance Code (DCGK) have also been further developed with adjustments almost every year in order to emphasize and promote the long-term nature of remuneration incentives in the sense of sustainable value creation. and increase the transparency of reporting. Since then, a very broad scientific and public debate has taken place. While in 2014 there was still intensive debate, e.g. The main cornerstones of the debates over the harsh remuneration ceilings or the extended reporting requirements under the DCGK seem to be the main cornerstones at the moment, as the intensity of the discussion decreases. The empirical analysis of the remuneration of DA X and MDA X companies until 20135, published in 2014, is to be continued below with the findings of the 2014 financial year. The focus is on how the salaries of the Executive Board have developed in recent years in their absolute level and composition (fixed, variable, options, etc.). For the first time, the expenses for pension provision can also be adequately mapped, as the newly introduced remuneration tables are enable DCGK to provide sufficient analysis. In addition, the relative development of executive board remuneration compared to company key figures is examined in terms of EBIT or average personnel expenses. This is particularly helpful with regard to the question of the adequacy of remuneration, since the public debate is always based on absolute amounts. According to the will of the legislator, however, the adequacy of the remuneration should be based, among other things, on the size of the company and the responsibility of the Executive Board. Therefore, remuneration can only be assessed in relation to corresponding measures. Particular attention will be paid in this study to the additional findings that can be generated by the model tables proposed in the DCGK.

read more