Publication of the 19th edition of Proxinvest’s Report “A Review of CEO Compensation in the SBF 120”

Press Realese

19th edition of Proxinvest’s Report

“A Review of CEO Compensation in the SBF 120”


Paris, 24 October 2018



  • A record year for compensation in France : +10%

Our report on CEO compensation in 2017 revealed record compensation levels. In the SBF 120, Average total CEO compensation amounted to €3.8 million, up 10% from 2016.

In the CAC 40, the average CEO even reached €5 million, up of 14% from the previous year. This amount exceeds our maximum socially acceptable pay of 240 times the SMIC (the French national minimum wage), or €4.87 million. Particularly, 29 CEOs in the SBF 120 surpassed this limit (23 in 2016).

We define total compensation as a measure that includes salary, annual bonus, attendance fees, payments-in-kind, stock options, restricted performance shares, other cash incentives, and other forms of indirect compensation.

Our results are a testament to the generosity of Boards when it came to awarding their CEOs in 2017. Base salaries, bonuses, and restricted shares gained 3%, 6% and 6% respectively across the SBF 120. Interestingly, two-thirds of compensation awards were in the form of short-term compensation.

Our report shows that the important growth of the compensation (14% for 2017 and 22% for the period of 2013-2017 in the CAC 40) is not justified, especially when compared with the creation of value for shareholders and with the evolution of the employees’ compensation.

  • The five highest paid CEOs were awarded over €10 million each

The CEO of Dassault Systèmes, Bernard Charlès, heads the list with a total compensation of €24.6 million (€15.8 M according to the company), mainly due to performance shares granted.

Not far behind was Gilles Gobin, founder and Managing Partner of Rubis. Contributing to his largesse was a €18 million share price-linked dividend (3% of annual increases) to compensate him for his dual role as General Partner (he controls two privately registered companies which serve as General Partners). This windfall comprised the lion’s share of his total compensation of €21.1 million. Since 2016, Proxinvest urges the company to modify the calculation method written in its bylaws.

Third in the raking is the controversial Carlos Ghosn, Chairman and CEO of Renault and Nissan. Following the rejection on his remuneration during the 2016 general meeting, the board has decided to decrease his compensation. Despite this decrease, his 2017 total compensation reached €13 M, including €5.6 M from Nissan. This latest slightly decreases despite the fact that he is no longer an executive officer of this company. Moreover, the targets set by the Board regarding his annual bonus (ROE, Free Cash Flow) are incredibly low.

Paulo Cesar Salles Vasques, CEO of Teleperformance until October 2017, received a termination package of €9 M and his total compensation for 2017 (only 10.5 months of duty) reached €12.2 M.

TechnipFMC makes our coveted list in fifth place with Douglas Pferdehirt, its CEO, boasting a total compensation of €10.6 million, up 88% since the merger. This post-merger increase, as the Chairman’s, is totally unacceptable considering the group’s performance since the merger (the share price dropped by 23.8%, the company has now a net loss of $65.3 M, while the company had a net income of $311.3 M in 2016 and the cash-flow decreased by 83%).

Moreover Douglas Pferdehirt has been granted some long term incentives (fixed shares and options) without any performance conditions. This poor US practice Is not in line with the AFEP-MEDEF code.

  • The Performance barometer, an innovation of the Proxinvest report

For the first time, Proxinvest presents a barometer which ranks the SBF 120-index companies according to their performances (based on their shareholder creation value (TSR = share price + dividends) and on their financial performances (revenues, EBIT, earning per shares and the operating cash-flow creation). This analysis shows that, between 2014 and 2017, there is no correlation between evolutions of CEO compensations and performances. In eleven companies, we even noted that the CEO remuneration increased by more than 10% while they are among the poorest performers.

  • To solve a late self-regulation by the companies

The growth of the CEO compensations in the large French listed companies does not help to reconcile the French people with companies as the new PACTE law tries to do. The requirement to communicate the evolution over five years of the CEO pay ratio should create a new intra-group framework which would be less inflationary (if the chosen criteria are relevant (Workforce in France and in the World).

The new change in the AFEP/MEDEF code (it is now not allowed to pay a non-compete agreement when the CEO retires and/or is 65) implemented following the heated public debate on George Plassat’s termination package (which he finally waived in june 2018) clearly shows that the French self-regulation on executives departures’ conditions always arrives too late to avoid the public scandal.  

Hence, to prevent future scandals, Proxinvest proposes some changes in the AFEP-MEDEF code: executives’ termination payments should not be greater than employees’ allowances; therefore, Proxinvest proposes to cap executives’ termination payments to a maximum of one year of annual compensation (vs 2 years allowed in the actual code).

Moreover, the AFEP-MEDEF code should comprise the prorata temporis principle so that remuneration to be granted (bonuses and long-term incentives) when the executive leaves the company are in line with the actual contribution of the executive and the time he spent in the company.




For any further inquiries:

Secretariat Proxinvest : +33 1 45 51 50 43 –

Jehanne Leroy, Analyst  –

Loïc Dessaint, CEO –


Proxinvest specializes in corporate governance research, shareholder engagement, and proxy voting advice.

This report will be made available exclusively in French for order as of 29 October 2018. All requests to Librairie LDEL/JUSTICIA.

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