VW Readies New Compensation Plan for Top Management

Volkswagen AG has developed a new plan that would cap the CEO’s annual compensation at €10 million and limit management board member payouts to a lower level, an unidentified source tells Reuters.

The new formula will give executives a higher base salary and lower variable pay, according to Handelsblatt. The German newspaper says bonuses will be linked to dividends and indexed to the performance of VW’s stock. Reuters says VW’s 20-member supervisory board will review the revised compensation plan on Feb. 24.

VW has been grappling with a new payment scheme since critics complained five years ago that then-CEO Martin Winterkorn had become Germany’s highest-paid executive. His compensation peaked in 2012 at €17.5 million.