Germany’s Allianz AG announced that its Board of Management has agreed by mutual consent with the Supervisory Board to provide individual disclosure of remuneration for the members of the Board of Management effective from the fiscal year 2004.
“The disclosure of emoluments for the members of the Board of Management will be made for the first time in the 2004 Annual Report, which will be presented at the Financial Press Conference on March 17, 2005,” said a bulletin on the company’s Website – http://www.allianz.com.
Also featured on the site are comments by Rainer Schätzle, who is responsible for the “system of emoluments” at Allianz and author of a book on the topic. He provided some background information in an interview with AllianzGroup.com News.
He stated: “The issue of ‘individual disclosure of remuneration for the Board of Management’ has been discussed by managers, the media and politicians of all parties for years. The debate has intensified significantly during recent weeks and months. This has raised public interest in individual disclosure.
“We have decided to go down the road of individual disclosure to meet this desire for increased transparency prevalent in the marketplace. There probably won’t be any big surprises in the figures. Remuneration for the Board of Management can already be fairly precisely calculated on the basis of the Annual Report. What’s more, remuneration of the Allianz executive management is quite appropriate – as shown in the latest studies.” As part of the planned change it was disclosed that Michael Diekmann, who heads the Board of Management, receives 900,000 euros (around $1.1 million) in annual salary.
The German government has been trying to get the country’s largest companies to disclose what their executives receive for over two years on a voluntary basis, but only 10 of the 30 biggest enterprises have done so.
The importance of Allianz decision lies in its departure from past German, and indeed most European, practices. While U.S. companies routinely set out what their executives are paid, it is not commonly done in Europe. In addition to bringing more transparency, as Schätzle observed, it also sets a precedent for other companies to follow the giant insurer’s lead.
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