Americanas: highest salary was 431 times the lowest – 07/04/2023 – Market

An exaggerated difference in remuneration between those at the top of the organization and the rest of the company is the big problem to be solved in an attempt to avoid corporate scandals like the one at Americanas. This is the opinion of specialists in management and governance consulted by the Sheet.

“This generates excessive internal competition, aggressive disputes for positions and power, demotivation and feelings of injustice among people at the base, in addition to a decrease in empathy and team cohesion”, says Alexandre Di Miceli da Silveira, doctor and master in administration of companies and finance, partner of Virtuous high management consultancy.

The Ethos Institute, aimed at disseminating good environmental, social and corporate governance (ESG) practices in the business environment, advocates reviewing the wage gap within companies.

“The absurd inequality of remuneration needs to be addressed”, says sociologist Caio Magri, president of Ethos – from which Americanas was suspended in March. In Swedish and Danish companies, he says, that difference is 20 times. “In Brazil, it is hundreds of times”, says Magri, recalling research carried out by corporate governance specialist Renato Chaves, in partnership with FGV (Fundação Getulio Vargas).

According to the survey, carried out in 2021, among all the companies belonging to the Bovespa Index, Americanas is the one that had the second largest salary discrepancy between the position of president and the average salary of employees: the main executive of the company received a remuneration 431 times the company average. In the ranking, Americanas only lost to Assaí, 535 times.

“If the executive paid tax on the dividends he receives, perhaps this difference would not be so absurd”, says Magri, for whom variable remuneration should always be linked to concrete corporate governance goals.

João Paulo Pacífico, founder of the securitization company Gaia, which structures credit operations for businesses with social and environmental impact, agrees. “I’m very skeptical about variable remuneration”, he says, recalling that, at Gaia, bonus payments were abolished 10 years ago.

“I’m in favor of paying good salaries and promoting a better division of resources. Some will earn more than others, but not bizarrely more”, says Pacífico, for whom Brazil should start to highlight the multiple between the highest salary ( fixed and variable) and the average paid by the organization. “Companies should put a limit: 50, 60, 100 times. But never 500, 600 or 1,000 times.”

To mitigate the risk, payment in shares to top leadership needs to be linked to the achievement of a set of collective indicators (not just focused on results), says Silveira. Examples of collective indicators are employee well-being, customer satisfaction, investment in innovation and not being fined by regulators.

The expert also defends the adoption of profit sharing for all employees. “It is necessary to reformulate the concept of success: the performance of a company is, fundamentally, a team game. Performance evaluation and remuneration must be collective.”

For Silveira, the rule of simplicity applies. “The greater the complexity of the incentive system, the greater the temptation to circumvent it. The more top management focuses on money, the less it will focus on the company and people.”