Union rebukes Renault’s decision to boost CEO salary image

The CGT, Renault’s largest trade union, criticized the automaker’s plan to lift chief executive Carlos Ghosn compensation for 2014 by more than 100 percent, to 7.22 million euros ($7.85 million).

The union immediately criticized the board’s decision to propose Ghosn’s remuneration for its 2014 performance. “Ghosn hits the jackpot and we get the crumbs,” commented the CGT in a statement. The French automaker in its home country alone is on its way to axe 7,500 positions in a drive to lower fixed costs by 396 million euros and in turn increase the automaker’s profitability – the labor agreements signed in 2013 also included a salary freeze for unionized workers. The proposed salary, tallying the cash and shares to be granted, for the chief executive is soaring to 7.22 million euros for 2014 from 2.67 million euros in 2013, states Renault’s 2014 annual report. That would come next to Ghosn’s compensation for leading alliance partner Nissan. The Japanese automaker paid him 95 million yen ($8.34 million) in salary and bonuses for the period ending March 31, 2014.

According to Renault the chief executive’s officer is naturally linked to the carmaker’s increased financial performance in 2014, when the company tripled its total profit to 1.89 billion euros, buoyed by increased deliveries in Europe and the 2013 agreement with unions. But the Financial Times said in a report last week that five of the 19 Renault board members voted against the proposed compensation for Ghosn. The negative vote also included the French state representative, with the latter owning 15 percent of the carmaker. The package can still be axed, because it needs to be also approved by Renault’s investors during the annual shareholder meeting on April 30.

Via Automotive News Europe