The remuneration of Carlos Ghosn goes badly – The World

Le Monde | 29/04/2016 at 20:09 • Updated 30/04/2016 at 10:43 | By Philippe Jacqué

The remuneration of Carlos Ghosn not befitting its shareholders. And especially to the state. Friday, April 29, during the general assembly of the Renault group, they have rejected 54.12% compensation of 7.2 million euros, 1.7 million euros in cash, the CEO of the French manufacturer . Although she was almost unchanged from 2014.

Since 2013, the shareholders of French firms is indeed on executive compensation as part of the “Say on Pay” set up by the AFEP-MEDEF code. This is, however, that an advisory vote. Met after the general meeting on Friday, the manufacturer of the Board of Directors announced that it maintained the compensation of Mr. Ghosn, congratulating himself as “ the quality of results” . Administrators, however, asked the Compensation Committee “consider useful changes in the pay structure for the years 2016 and following” .

This is the first time that the shareholders of a CAC 40 company reject the remuneration of an officer. That it intervenes at Renault is not really a chance. First, its CEO has been criticized because it combines two salaries, one from Renault and Nissan that of his ally, he also directs. As such, in 2014, he obtained a total compensation of 15 million euros (7 million to 8 million for Renault and Nissan).

Bercy Victory

Above all, this affront to one of the most powerful french patrons bears the signature of the state, which owns 19.74%. Since 2012, the salary of public sector CEO was reduced to 450,000 euros per year. In parallel, the State opposes any fee higher in companies where it is a minority, whether Air France or PSA.

Nothing targeted against Renault, therefore, yet this victory Bercy is especially significant in the standoff that pits the economy minister, Emmanuel Macron, and Mr. Ghosn. In April 2015, Mr. Macro had increased from 15% to nearly 20% public share in the diamond brand to weigh at the general meeting and get the double voting rights associated with Florange law. This episode had caused considerable tension with Mr. Ghosn and Nissan with the Japanese and had resulted in a governance agreement, which was approved Friday meeting.

Friday, it also confirmed at Bercy that the State had voted against the General assembly resolution establishing the compensation of Mr. Ghosn. Similarly, the state representatives on the board, which met in the wake opposed to maintaining its “package”.

15 million euros to manage both companies

So far, this was not enough to rally a majority in the assembly. In 2014, 64% of shareholders approved the remuneration of Carlos Ghosn, while in 2015 this rate had fallen to 58%. But the exasperation of shareholders on the sensitive topic of remuneration is only up around the world, as evidenced by the rejection of the compensation of oil BP boss on 14 April.

“under the 2015 financial year and only Renault, Carlos Ghosn received a fixed amount of 1.23 million euros, unchanged, which exceeds by 25% the median of executive chairmen of the CAC 40. as Carlos Ghosn divides his time between Renault and Nissan, and therefore receives double remuneration for this, it would be appropriate fixed remuneration Renault is well below the median CAC 40 “, ensures Proxinvest, a consulting company to investors on their policy commitment and exercise of voting rights.

Questioned by Pierre-Henri Leroy, the head of Proxinvest at the general meeting, Ghosn said it was “not him” and “the board that sets the compensation, itself prepared by the remuneration Committee” . “As a shareholder you give delegation (…) to the board, he shall not judge based on a whim but judge whether the way the CEO is paid is in line with his efforts, his talent, the situation (…) we have a very clear, transparent “, he says, adding that “the most important thing is that Renault goes well” .

If Ghosn displays a stratospheric remuneration (on average three times more than its peers in the CAC 40 in France) it does not detonates vis-à-vis its peers in the automotive sector. With 15 million euros, to manage two companies that produce in common some 120 billion euros of turnover, it is at Mark Fields, head of Ford (EUR 16.5 million for a sales of Ford’s 128 billion euros in 2014)

Read the interview. “a world that is normal that people earn in a week that d others take years to collect “