In 2023, the pay ratio between the CEOs of the CAC 40 and the median salary of their employees exceeded 100 to 1. Over the past ten years, this differential has been increasing, while employee salary growth remains limited.
Boards of directors cite the need to attract international talent and reward performance, while critics highlight the risk of social fracture and internal demotivation. Public authorities are hesitant to intervene, oscillating between calls for transparency and attempts to impose caps.
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Wage gaps that raise questions: overview and evolution between executives and employees
The gap between the compensation of top executives and that of all employees continues to grow. The figures from the CAC 40 leave no room for ambiguity: in some cases, the threshold of 5 million euros annually is crossed without hesitation, accumulating fixed salaries, bonuses, fringe benefits, and stock options. Meanwhile, the minimum wage progresses slowly, and the majority of employees must settle for symbolic raises, regularly eroded by inflation.
To illustrate the extent of these gaps, one only needs to look at the case of Jean-Pascal Tricoire. The CEO of Schneider Electric, a leading figure in French capitalism, sees his compensation dissected in the survey “What is the salary of Jean-Pascal Tricoire, CEO of Schneider Electric? – Nadoz”. This level of income is no longer just a moral issue; it stands as a reflection of an internal power dynamic within listed companies, and a French salary model that raises questions.
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Over the last ten years, the ratio of executive pay to median salary has continued to widen. Companies like Sanofi, along with other major players in the SBF 120, are perfecting compensation systems that include variables, bonuses, stock options, and deferred benefits. Meanwhile, the base salaries remain constrained by expected performance or company size, when they are not simply dictated by shareholder expectations.
The salary issue has taken center stage in economic debate, highlighting a persistent tension between the valuation of productive work and shareholder logic. The Sapin 2 law has imposed more transparency on compensation, but criticism persists, as does pressure on boards of directors, who are called upon to justify amounts that continue to swell.
Should we rethink the place of top executives in society? Justifications, impacts, and avenues for reflection
Some defend the high salaries granted to top executives by arguing that international competition requires attracting profiles capable of steering sprawling companies. The burden on the shoulders of these executives would, according to them, be commensurate with the sums involved. In reality, the gap between these justifications and the feeling of injustice among a large part of the population does not diminish. The idea of merit, invoked at every general meeting, quickly finds its limits when results disappoint, as shown by some CAC 40 giants in recent years.
What impacts on society and the French economy?
The wage gap causes several concrete consequences, both in companies and in society. Here are the main outlines of these effects:
- The wage bill dangerously tilts towards the highest incomes, reducing the ability to better financially recognize the work of all employees.
- Concepts like the employee dividend or the ecological dividend are entering the public debate, questioning how the value created should be redistributed, beyond just shareholders and executives.
- While the European directive and the Sapin 2016 law impose greater transparency, they do not rebalance the sharing of value between executives and employees.
To take action, several levers could be mobilized: increasing taxation on very high incomes through corporate tax, strengthening the role of employees on boards of directors, or revising the criteria that trigger variable compensation for executives. The French state, a historical shareholder of groups like Renault or SNCF, bears some responsibility in the current dynamics. On the ground, the question of shared profit, the meaning of work, and social cohesion haunts discussions, from Parisian offices to provincial workshops.
Faced with these gaps that are becoming entrenched in the landscape, it is hard not to question the image that France projects in the 21st century. How far can we stretch the rope before the bond finally breaks?