Wednesday, March 22

Ibex 35 executives earn 60 times more than their workers and the gap skyrockets during the pandemic

The executive director of an Ibex 35 company earns an average of almost 3.3 million euros. The average salary of a worker in these companies receives 55,000 euros a year. In other words, an employee would have to work 60 years to earn the same amount that the executive receives in one year. This follows from the analysis made by the National Commission of the Walloon Market (CNMV) of the corporate governance and remuneration reports of listed companies. The gap has ballooned during the pandemic.

Last year, good governance regulations forced listed companies to indicate the average salary of their staff and compare it with the salary of their executive directors. The accounts carried out by the CNMV eliminate the extraordinary elements of the income of an executive director, so the gap could be even higher.

The CNMV compares in its report the data from 2019, 2020 and 2021 and concludes that the difference between an average worker and an executive has skyrocketed. The course prior to the pandemic ended with a difference of 47 times in favor of the superior. In 2020 it increased to 58 times and in 2021 it has ended up being on the verge of 60 times. The supervisor provides the accumulated data of this report to which listed companies are obliged to fill in, so it does not indicate which ones are where this difference is greater. Although, he recognizes that there are big differences between companies.

The report also compares the figures between the Ibex 35 companies with those that are listed but do not appear in the selective stock market that includes the most important. In this case, the gap is much smaller, although still important. The executive director of these companies earns an average of 800,000 euros, compared to 48,000 euros for their workers. In this case, the difference is 17 times, compared to 60 in the case of Ibex35 companies. Taking into account the set, the average of all listed companies is a gap of 32 times.

The data shows how the evolution of salaries increases this difference between executives and their workers. In the case of the Ibex 35, the former saw their remuneration increase by 4%, compared to 1.9% for the average employee.

The document published this Monday by the CNMV also analyzes the presence of women in the highest echelons of companies. Their presence on the boards of directors has increased over the last year, accounting for 29.3% of the total. The figure is higher in the case of the Ibex, where it reaches 34%. However, this increase carries a fine print. The main presence of women on boards of directors is as independents, where they already account for 43%. They also increase among the dominical companies, which represent shareholders, where they reach 23% of the total.

However, their presence as executives is still residual, accounting for 6.4%. They also still have a lower weight among senior management positions, accounting for less than 20% of these positions.

The CNMV report provides a multitude of data on remuneration and highlights that the remuneration of the boards of directors increased by 13.2%. The document attributes it to the ordinary remuneration derived from the dismissal of directors in a company. Without these payments, the increase would have been 5.2%. The average remuneration of executive directors increased by 7.1% to 1.7 million euros, and that of non-executive directors, 28.5%, to 167,000 euros.