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Stellantis boss Tavares defends pay rise ahead of shareholders’ vote

Tavares said his renumeration was 'contractual'
Tavares said his renumeration was 'contractual' - Copyright Israeli Army/AFP -
Tavares said his renumeration was 'contractual' - Copyright Israeli Army/AFP -

Stellantis chief executive Carlos Tavares has defended his 36.5 million euro ($38.75 million) pay package ahead of a vote Tuesday by the car giant’s shareholders.

The vote at an annual general meeting in Amsterdam is non-binding but will be closely watched after several activist investors called for a vote against the salary. His wage was rejected in 2021.

According to the Stellantis annual report, the 65-year-old Portuguese executive is to get a 10 million euro bonus for the transformation of the group — formed out of the 2021 merger of Peugeot and Fiat-Chrysler — that would take his pay to 36.5 million euros.

On a visit to a group factory in Tremery, eastern France, on Monday, Tavares said his remuneration was “contractual” between Stellantis and himself “like for a footballer and a Formula One driver.” 

“Ninety percent of my salary is made up of the enterprise’s results … so that proves that the enterprise’s results are apparently not too bad,” he told the France Blue Lorraine Nord radio station.

“If you believe that it is not acceptable, make a law, modify the law and I will respect it,” declared Tavares.

Stellantis’ 14 brands, that include Opel, Fiat, Dodge, Peugeot and Citroen, together made record profits of 18.6 billion euros in 2023, up 11 percent in a year. Turnover was close to 190 billion euros.

Tavares earned 23.5 million euros for 2023, much of it paid in shares. The figure includes pensions that are more long term payments and bonuses that depend on the group performance in 2025 when his current term ends. 

The salary also depends on the Stellantis share price which has nearly doubled in the past three years.

But Tavares’s remuneration has already drawn controversy. In 2022, French President Emmanuel Macron said called the wage “shocking and excessive”.

The group has said the wage should be compared to other multinational giants — Boeing CEO Dave Calhoun earned $33 million in 2023.

After the 2021 rebuff, Tavares 2022 salary was approved by 80 percent of shareholders voting at the AGM.

Several governance advisory services monitors have recommended voting against the CEO’s salary package this year, including Glass Lewis.

The French left wing union CGT called the salary “totally shocking and scandalous” when many employees were “struggling”.

Stellantis said in February that it would share 1.9 billion euros among its employees worldwide. For French workers, that will mean a minimum of 4,100 euros.

Group shareholders will get 7.7 billion euros for 2023 in dividends and benefits from a share buyback.

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With 2,400 staff representing 100 different nationalities, AFP covers the world as a leading global news agency. AFP provides fast, comprehensive and verified coverage of the issues affecting our daily lives.

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