GERMANY: DaimlerChrysler to axe executive stock options
DaimlerChrysler will no longer reward its executives by offering them the right buy shares in the carmaker at a discount, a group spokesman reportedly said on Sunday.
According to Reuters, the spokesman said Daimler chief executive Juergen Schrempp would present a new remuneration system for its 6,000 executives at the group's annual shareholders meeting in Berlin on Wednesday.
The company has reportedly discussed the change with institutional investors such as funds in recent weeks - the old stock options plan expires next year.
Reuters said the spokesman declined to give details but German Sunday newspaper Die Welt reported half of executives' remuneration would in the future depend on the group's net return on capital, and the other half on Daimler's return on sales over a three-year period compared to its top three rivals in a peer group.
The news agency added that stock options for executives have been criticised for often being too cheap and for giving them an incentive to drive up share prices in the short term without considering long-term consequences.