The CEOs of DAX companies earned around three percent more in 2024 than in the previous year. This results from the annual study by Prof. Maximilian Blaschke, TUM Chair of Management Accounting, and Prof. Dr. Jürgen Ernstberger, TUM Chair of Financial Accounting, in cooperation with the German Association for the Protection of Shareholders (DSW).
The DSW executive compensation study is considered one of the most prestigious studies of its kind in Germany. It has been published annually for many years and regularly attracts considerable media attention. This year, the TUM Campus Heilbronn was involved: Lino Ballof, research assistant at Prof. Ernstberger's chair and at Prof. Michael Stich's Chair of Accounting at Campus Heilbronn, took over the operational management and implementation of the study together with Felix Müller and two doctoral students from the Controlling Chair. This included data collection and analysis, the preparation of the results report and of the content for the press conference at which the results were presented this week.
41X More
The average total compensation of a member of the executive board of DAX companies has risen slightly again and is now 41 times the average personnel expenses per employee.
However, CEOs of DAX companies earned significantly more than their fellow board members, with an average of €5.747 million (average total remuneration per board member excluding chairpersons: €3.234 million).
Magical Barrier of €10 Million Broken
DSW defined €10 million as the compensation limit that is considered reasonable. In 2024, this barrier was broken twice. DSW sees this limit as an important indicator of social peace and warns against its gradual erosion through rising maximum remuneration.
24 Percent More for Male Board Members
Male board members earn on average 24 percent more than their female colleagues. This difference can be attributed, among other things, to a discrepancy between men and women in the appointment of the position of CEO.
International Comparison
In addition, board members abroad earn more than their German counterparts. CEOs in Switzerland receive €8.222 million, in France €6.390 million, in the Euro Stoxx 50 (excluding Germany) €7.916 million, and in the US as much as €28.530 million. The compensation of German CEOs appears to be rather “low” in international comparison. On the other hand, the maximum possible compensation in Germany has risen significantly in recent years and further increases have already been announced.
Sustainability Plays a Central Role
The ESG criteria (environmental, social, and governance) continue to play a central role. In the 2024 fiscal year, all 40 DAX companies used at least one of the three ESG criteria to incentivize their executive boards. This confirmed the level of the previous year, in which all 40 DAX companies had anchored ESG targets in their compensation systems for the first time. 70 percent of DAX companies include all three ESG criteria in their compensation.
Next Steps
Greater transparency in the presentation of compensation, for instance by implementing uniform reporting across Europe, could be an important first step in this direction. Furthermore, compensation must be reasonable and reflect the performance of the Executive Board. It is important to maintain a balance between global competitiveness, long-term value creation and social acceptance.
Here the link to the full press conference.
The DSW executive compensation study is considered one of the most prestigious studies of its kind in Germany. It has been published annually for many years and regularly attracts considerable media attention. This year, the TUM Campus Heilbronn was involved: Lino Ballof, research assistant at Prof. Ernstberger's chair and at Prof. Michael Stich's Chair of Accounting at Campus Heilbronn, took over the operational management and implementation of the study together with Felix Müller and two doctoral students from the Controlling Chair. This included data collection and analysis, the preparation of the results report and of the content for the press conference at which the results were presented this week.
41X More
The average total compensation of a member of the executive board of DAX companies has risen slightly again and is now 41 times the average personnel expenses per employee.
However, CEOs of DAX companies earned significantly more than their fellow board members, with an average of €5.747 million (average total remuneration per board member excluding chairpersons: €3.234 million).
Magical Barrier of €10 Million Broken
DSW defined €10 million as the compensation limit that is considered reasonable. In 2024, this barrier was broken twice. DSW sees this limit as an important indicator of social peace and warns against its gradual erosion through rising maximum remuneration.
24 Percent More for Male Board Members
Male board members earn on average 24 percent more than their female colleagues. This difference can be attributed, among other things, to a discrepancy between men and women in the appointment of the position of CEO.
International Comparison
In addition, board members abroad earn more than their German counterparts. CEOs in Switzerland receive €8.222 million, in France €6.390 million, in the Euro Stoxx 50 (excluding Germany) €7.916 million, and in the US as much as €28.530 million. The compensation of German CEOs appears to be rather “low” in international comparison. On the other hand, the maximum possible compensation in Germany has risen significantly in recent years and further increases have already been announced.
Sustainability Plays a Central Role
The ESG criteria (environmental, social, and governance) continue to play a central role. In the 2024 fiscal year, all 40 DAX companies used at least one of the three ESG criteria to incentivize their executive boards. This confirmed the level of the previous year, in which all 40 DAX companies had anchored ESG targets in their compensation systems for the first time. 70 percent of DAX companies include all three ESG criteria in their compensation.
Next Steps
Greater transparency in the presentation of compensation, for instance by implementing uniform reporting across Europe, could be an important first step in this direction. Furthermore, compensation must be reasonable and reflect the performance of the Executive Board. It is important to maintain a balance between global competitiveness, long-term value creation and social acceptance.
Here the link to the full press conference.
