Vw tying salaries of its top managers to customer and employee satisfaction
By Andrew C., 30 Aug, 2010. 0 Comments
Volkswagen AG is basing its new long-term bonus program, not anymore on share price development, but on other key elements that include customer and employee satisfaction, sales numbers and profitability. This program takes effect in 2010.
Horst Neumann, VW's personnel boss, said that unlike other companies, it no longer links management pay to the share price development. Stock options are said to no longer be part of executive remuneration. Before the new bonus is paid out, Neumann said that achievements for the last four years will be evaluated. Another precondition for the bonus payments is that company has recorded a profit. This move comes amid heated discussion about bonus payments for bankers, which have resulted in a special tax in Britian. To date, Germany has not introduced a similar rule but has passed a law requiring executive salaries to be connected to the long-term development of the company.
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