Majority of CEOs of Belgian listed companies see total remuneration increase

These are some of the findings in the Vlerick Business School Executive Remuneration Research Centre's annual report on the remuneration of CEOs at listed companies. The research was conducted by Xavier Baeten and senior researcher Marthe Van Hove, using the remuneration reports of Belgian listed companies for 2024. In what is a major new development, the Vlerick database is now entirely fed by PAYBRAIN^®, a Large Language Model developed in collaboration with Deloitte.

As Senior Researcher Marthe Van Hove explains, "the use of artificial intelligence has made data collection both more efficient and more reliable, while also providing opportunities to collect additional relevant data.”

CEO salaries in Belgium: an upward trend

The study provides an annual overview of key remuneration data and how it is evolving. For example, the median total remuneration (including fixed salary, short-term bonus and long-term remuneration) was €3,092,587 for Bel 20 companies, €1,293,480 for Bel Mid companies and €941,191 for Bel Small companies. For 2023, these figures stood at €2,810,634, €1,061,653 and €545,705 respectively.

The difference in the Bel Small figures, an increase of 72%, is particularly striking. This was largely due to a change in composition of the stock market index. For 2023, the Vlerick database held remuneration data for 22 companies, with a median market capitalisation of €121 million. In 2024, this stood at 17 companies, totalling a median market capitalisation of €200 million.

Marthe Van Hove: “The most significant explanation is the fact that the index is now composed of companies that are larger than those in 2023. Moreover, the Vlerick team analysed companies that were on the Bel Small Index in both 2023 and 2024, of which there are 11. Here, the median increase only stood at 9%. Eight companies gave their CEO a raise, while CEOs at the other three took home a reduced pay packet.”

By applying the same process to all Belgian listed companies, the researchers arrived at a ‘matched sample’ (i.e. firms for which data is available in both 2023 and 2024) of 41 companies. In 49% of cases, companies granted CEOs more than a 10% pay increase, with another 12% of companies awarding between 5% and 10%. Conversely, 22% of companies reduced their CEO’s pay by more than 5%. Add to that some 17% of companies that occupied a range between a 5% increase and a 5% decrease (i.e. relatively stable). The median increase percentage was 9%.

International comparison

PAYBRAIN^® also has access to the Stoxx 600 index remuneration data (i.e. the 600 biggest European listed companies, including 17 Belgian companies). For the Belgian companies included in this index, the median was €3,092,587, compared to €4,663,320 for the Netherlands, €4,780,021 for Germany, €4,392,510 for France, and €4,925,029 for the UK. In comparison, the 2023 figures stood at €3,066,938 for Belgium, €3,702,265 for the Netherlands, €4,362,393 for Germany, €4,380,745 for France and, last but not least, €4,560,409 for the UK. While the increase in Germany is driven by a higher short-term variable remuneration, the increase in the UK is due to long-term variable remuneration.

Changes in performance indicators for variable remuneration

Companies may apply both financial criteria (e.g. profitability, share price) and non-financial criteria (e.g. customer satisfaction, quality, environment) to determine the variable remuneration. Over the past 5 years, it is striking how non-financial performance criteria have gained importance in Belgian companies – while only one non-financial criterion was generally used to determine short-term variable remuneration in 2020, 2024 saw two being used (i.e. double). When it comes to long-term incentives, usually paid out in the form of shares, the evolution over the same period was from zero to one non-financial criterion.

Sustainability indicators, also referred to as ESG criteria, are an important example of these non-financial performance indicators. With regards to short-term variable remuneration, there was a very slight increase in the use of emissions indicators (from 8% to 10%), compared to a more pronounced increase in the number of companies utilising employee-driven indicators – e.g. safety, employee satisfaction – from 22% to 31%. More generally, 72% of Belgian listed companies now include one or more sustainability indicators in their systems for determining short-term variable remuneration, as compared to 49% in 2020. However, Belgium continues to lag behind Europe, where 28% of companies include emissions indicators and 48% include employee-driven indicators. However, it is important to note that the number of European companies including sustainability indicators is decreasing. As such, the percentage of European companies that include diversity at the highest levels of the company as a target has fallen from 18% to 7%.

Xavier Baeten, Professor of Reward & Sustainability at Vlerick Business School: “Each year, we re-examine the developments in median total remuneration and underlying components. While this data is useful, we must take caution in how we interpret it. That is why we have also considered exactly which factors determine the evolution of CEO remuneration within a company. While we see that size and profitability drive total remuneration upwards, we also observe that, when shareholdings are more concentrated, remuneration decreases, as it does when a CEO is appointed who has risen through the ranks internally.

“In addition, there were also some intriguing findings relating to the underlying criteria for remuneration. We have noted a trend towards a greater and better balance between financial and non-financial criteria, which also ties in with the increased complexity of the business context. Regrettably, we found that fewer European companies applied sustainability criteria in 2024, and that, when they do, they are mainly in the areas of emissions and diversity.”