• Sweden edition
 

Swedish CEOs make peanuts in Euro study

Published: 15 Dec 2009 16:36 GMT+01:00
Updated: 15 Dec 2009 16:36 GMT+01:00

The review, carried out by Swedish corporate communications consultancy Hallvarsson & Halvarsson (H&H), also shows that the variable compensation paid to Swedish company chiefs is much lower than that paid to CEOs in other countries.

The heads of Sweden’s 23 largest listed companies, excluding investment firms, earn an average of 13.5 million kronor ($1.87 million) in salary each year, not counting pension contributions.

The figures comes in somewhat lower than the 16.8 million kronor average salary earned by CEOs in the Nordic region, and well below the 36.6 million kronor paid to the heads of other companies throughout Europe.

Adjusted for the fact that Swedish CEOs lead smaller companies than many of their European counterparts, the H&H study reveals that Sweden’s top managers earn about 43 percent as much as their colleagues in Europe.

“That doesn’t surprise me in the least. That’s just about how things look,” Christer Ågren, deputy head of the Confederation of Swedish Enterprise (Svenskt Näringsliv) told the TT news agency.

According to him, the appropriate pay level for a CEO is something that must be decided by each company’s board of directors.

“Companies shouldn’t pay more than they need to attract quality people to the job,” he added.

Carina Lundberg Markow, head of corporate governance with the Folksam insurance company, goes a step further in her analysis.

“If you want to have a career abroad, all you have to do is move to another country,” she told TT.

At the same time, she thinks it’s hard to compare between countries based on salary listings without taking other considerations such as price levels, the pension system, and social benefits into account.

“The entire cost situation needs to be included,” she said.

According to Ågren, one consequence of Sweden’s low CEO salaries could be difficulties recruiting foreign management talent.

But Lundberg Markow disagrees.

“If you want to have a specific competence, you simply have to pay for it,” she said.

Lena Westerlund, chief economist with Sweden’s main trade union organization, LO, thinks it more important to compare CEO salaries with what other workers earn in a country.

She’s also concerned about the increasing earnings disparities around the world.

In her eyes, the international success of Swedish companies is evidence that CEO salaries are high enough.

“I can’t see how the salary levels in Sweden can be a problem given the needs we have,” she said.

The H&H study, which was carried out ahead of a workshop on CEO salaries scheduled for next year, also shows that the heads of Sweden’s largest companies have a substantially lower percentage of variable compensation in their total earnings package compared to their European counterparts.

About one third of Swedish CEOs’ compensation consists of variable compensation, compared to about half for other Nordic countries, while variable compensation accounts for about 73 percent of annual earnings by CEOs in other European countries.

According to the survey, Ericsson’s Carl-Henric Svanberg is Sweden’s highest earning CEO, pulling in 24 million kronor last year, excluding pension contributions.

TT/The Local (news@thelocal.se)

Don't miss...X
Left Right

Your comments about this article

05:29 December 16, 2009 by randyt
In this article; "According to the survey, Ericsson's Carl-Henric Svanberg is Sweden's highest earning CEO, pulling in 24 million kronor last year, excluding pension contributions."

And then the headline from a few days ago; "Ericsson to Lay Off Nearly 1,000 Employees."

"Carl-Henric, your doing one heck of a job!" - words W Bush would say if he had stock in Ericsson.
08:43 December 16, 2009 by miau
I wonder if the same is true for an ordinary worker's salary in Sweden vis-a-vis Europe? I nearly took a job in Germany where the pay was €400 a month more (after tax). But after deducting the higher cost of housing, child care and transport, I still came out ahead in Sweden with a lower salary.
15:58 December 16, 2009 by glamshek
After all why does Mr Svanberg get paid so hugely? Ericsson to cut 450 jobs in Lund.... Close one plant in Stockholm..... Shut another .... The more these people get paid, the more the bring it down. And its strange . Its almost everywhere. The more one is clever, the more it is damaging for the whole economy in larger spectre.
12:12 December 18, 2009 by krigeren
CEO's are paid according to comparisons from those in their industry. Svanberg does not make much money compared to others in his industry.

Cost cutting measures, reduction in force, "rightsizing" measures are all part of management's toolbox. Cutting a workforce can lead to growth over time and the argument of ridiculing his salary in light of letting workers go is not a germane argument.

Many companies are doing poorly now due to industry wide issues. Some CEO's are receiving bonuses for keeping the losses to a minimum let alone turning a profit....its a reflection of the economy.

On a positive note. Once people get into the income range by the top few percent of the population pricing here is Sweden from a European perspective is quite cheap. One can buy their dream farm with many hectares of land for a very reasonable price compared to other countries. From a Scandinavian perspective if you are a car buff the taxes on vehicles are minimal.

The trick to living in Sweden is to generate your income from outside of Sweden and/or owning companies here and then it turns out all right.

The rank and file always complain about the wealthy when they should be focusing on getting ahead themselves. Sweden is rife with opportunities...
15:26 December 18, 2009 by rumcajs
That is good!

Why? Not because I don't like CEO's, but because in those other countries where the CEO's get more money, the "not CEO's" don't get enough to live as cool as in Sweden. And what happens then? If I have a pub, it's way better for me to have 10 "not CEO's" with a comfortable salary who will buy 3 beers each (10x3=30) and one quite rich CEO who'll buy 5 (30+5=35) than 5 "poor f**d up with mortgage not-CEO's who will buy 1 beer each (5 beers) and only one filthy rich CEO who won't be able to drink more than 10 beers even if he can buy 50 (5+10=15).

Not socialism or liberalism or any "ism", no politics.... just numbers.
06:29 December 20, 2009 by krigeren
@rumcajs

I see you point however, in Sweden due to the taxes on alcohol those 10 non-CEO's will be drinking their first 4 to 6 of those 10 beers in a grocery store and drink them at home or make their own booze in a still in their backyard.

Go to England, America, or Canada.........I don't see a shortage of pubs or non CEO's drinking it up.
Today's headlines
Elections 2014
Parties duel as refugee costs skyrocket
Photos: TT

Parties duel as refugee costs skyrocket

Prime Minister Fredrik Reinfeldt and Opposition Leader Stefan Löfven clashed on Wednesday after the Migration Board asked for more money to handle Sweden's influx of refugees. READ  

Introducing: Sweden's five minority languages
The Sami in northern Sweden. Photo: Fredrik Sandberg/TT

Introducing: Sweden's five minority languages

Did you know there are five official minority languages in Sweden? The Local's Isabela Vrba finds out what they are, how they're protected, and what rights their speakers have. READ  

Swedish docs puzzled by deformed penis trend

Swedish docs puzzled by deformed penis trend

More and more Swedish boys are born with deformed penises, and researchers are uncertain exactly what's behind the increase. READ  

The Local List
What Sweden means to you in just one Tweet
Photos: Shutterstock/Imagebank Sweden

What Sweden means to you in just one Tweet

The Local Sweden has been asking readers to squeeze their view of Sweden into just 140 characters or less. Here's what you came up with up for #SwedeninaTweet. READ  

Getinge Floods
Swedish floods hit day two as rain continues
Photo: Anders Andersson/TT

Swedish floods hit day two as rain continues

UPDATED: The flood in southern Sweden showed no signs of abating on Wednesday, with forecasters predicting that the rains are unlikely to stop any time soon. READ  

Sweden and the Bronx
Swedes celebrate 375th anniversary of the Bronx
The Bronx. Photo:Shutterstock.

Swedes celebrate 375th anniversary of the Bronx

What do the Bronx and Sweden have in common? More than an affiliation with the Yankees, it turns out. And one small Swedish town is about to make that abundantly clear. READ  

Bildt: 'We must increase efforts in Iraq'
Bildt in Baghdad on Monday. Photo: Karim Kadim/TT

Bildt: 'We must increase efforts in Iraq'

After meeting with refugees and politicians in Iraq on Tuesday, Foreign Minister Carl Bildt said Sweden must increase its efforts to help Iraq reach a lasting solution. READ  

Swedes slam 'racist' art show from Denmark
One of the participants in the art project. Photo: Anna Andrea Malzer, Global Stories

Swedes slam 'racist' art show from Denmark

Swedes have gathered in numbers to protest against a Danish "blackface" art show in Malmö, which organizers say is supposed to give "a deeper understanding of discrimination". READ  

Presented by Stockholm School of Economics
Swedish school with executive appeal
Photo: Stockholm School of Economics

Swedish school with executive appeal

More and more executives are combining work with further education, namely an MBA. The Local explains just how the process works at the Stockholm School of Economics with its Executive MBA program. READ  

In Pictures: The Local's Property of the Week
Fastighetsbyrån

In Pictures: The Local's Property of the Week

Ever wanted to live in a loft-like apartment on the hip district of Södermalm, with a view like something out of a colourful children's book? Check out The Local's Property of the Week. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Gallery
See more images from the southern Sweden floods
Sponsored Article
Find out what gives this Swedish school executive appeal
Society
Serial chicken smuggler caught at Norway border. Again.
Society
This gold coin may be the key to solving a Swedish massacre
Shutterstock
Lifestyle
The Swedish mentor (and why you may need one)
Blog updates

17 August

Sea Fever (Around Sweden in a kayak) »

"I’m going to keep this post short and sweet as its not something I take any pleasure in writing. After much deliberation I have made the heartbreaking decision to abandon my trip after 1200km due to reoccurring injury. It is not a decision I have made lightly and it is one that has been truly devastating..." READ »

 

17 August

St. Louis strong (Blogweiser) »

"It’s typically a bad sign when my hometown makes news in Sweden. St. Louis was in the headlines here a few years ago when a tornado struck the airport. The city also caught attention after a politician talked about ‘legitimate rape’. Now, shooting and riots this week in Ferguson, a part of St. Louis, are..." READ »

 
 
 
National
Food agency warns girls: 'Don't eat stinky fish'
Politics
Reinfeldt calls for tolerance to refugees
Gallery
People-watching August 16-17
National
Sweden celebrates 200 years of peace
Society
Top ten literal Swedish words
Politics
'Terror training should be illegal': Liberal Party
Gallery
Swedes talk about 200 years of national peace
Politics
Islamic extremist shakes Sweden with TV threat
National
Teacher fined for 'Hitler salute' in German class
Politics
Swedish politician proposes ban on begging
National
Swede asks for epidural and gets disinfectant
National
Swede reports 'expensive' sex to police
Education
Sweden plans to scrap SFI for adult education
Features
Kiruna residents talk life in a town on the move
TT
Politics
Why is feminism such a hot topic in Sweden?
National
Swedish dad takes kids to Israel to learn about war
National
RIP Åle, the world's oldest eel
Society
Introducing: The Swedish crayfish party
National
Stockholm bus spontaneously combusts
Skatteverket
Sponsored Article
Introducing... ID cards and permits in Stockholm
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

662
jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit:
www.swedishdowntown.com
PSD Media
PSD Media is marketing company that offers innovative solutions for online retailers. We provide modern solutions that help increase traffic and raise conversion. Visit our site at:
http://psdmedia.se