President Emmanuel Macron has called for an EU-wide framework to cap “abusive” executive pay after anger in France over a €19.1mn package for the head of carmaker Stellantis.
The criticism of the award to Carlos Tavares came as Macron entered the final weekend of the French election campaign seeking to fend off far-right challenger Marine Le Pen, who also condemned the pay for the head of the Franco-Italian company.
Ahead of the April 24 presidential election run-off, the issue of executive pay has crept into a campaign dominated by voter worries over high energy costs and broader cost of living problems.
Unions and shareholders have opposed the payout for Tavares, formerly the head of French Peugeot maker PSA, which merged with Italy’s Fiat Chrysler last year. The Portuguese executive will collect the multimillion-euro package for 2021 despite a majority of investors voting to oppose Stellantis’ pay plan for its senior managers.
Macron called Tavares’ pay package “shocking and excessive” on Friday and said a “fight” to ensure executive pay levels were not abusive should be led at EU level.
“At some stage we have to lay out ceilings and bring in a governance structure at European level that makes things acceptable, otherwise at one point society will explode,” Macron told Franceinfo radio. “People can’t be struggling with the high cost of living and see these kinds of sums.”
“Of course it’s shocking,” Le Pen told BFM TV when asked about the pay package. “It’s even more shocking when it’s bosses of companies that have run into trouble. That happens quite a lot.”
Long labelled as a “president of the rich” by political opponents, Macron, a former banker who came to power in 2017 on a pro-business platform, said he was in favour of wealth creation and “freedoms” for companies but said the Stellantis pay plans were “astronomical”.
He said France could also look at ways to let staff benefit more from company profits through share schemes.
Le Pen has campaigned heavily in recent months on issues such as food inflation and high fuel prices, which have risen further since Russia’s invasion of Ukraine. Her emphasis on the high cost of living, away from her party’s longstanding focus on immigration issues that are still core to her manifesto, has struck a chord with voters.
Polls put Macron on around 53 per cent of voting intentions in the run-off, with Le Pen tailing him at 47 per cent.
Stellantis is incorporated in the Netherlands, meaning the French government has little sway over its governance rules, although state-owned investment bank Bpifrance, the carmaker’s fourth-biggest shareholder, voted against the pay plan.
PSA and its car loans arm had to be bailed out by the French government in 2012 with state-backed loans following a prolonged market slump, although that was before Tavares, a former Renault executive, joined the group in 2014.
“Stellantis recalls that under the leadership of Carlos Tavares, in less than eight years, Groupe PSA went from a situation of near bankruptcy to the rank of leading company in its sector on a world scale,” the company said in a statement.
The world’s fourth-biggest carmaker, which reported record profits and margins last year, has said it would take the non-binding vote against its plans into account for 2022, although it did not detail how.