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Prof. Hutzschenreuter about board member compensation in listed German corporations

Prof. Hutzschenreuter published an article about board member compensation in listed German corporations. The article “Entgelt soll einfach und transparent sein” was published in the printed version of the Frankfurter Allgemeine Zeitung (FAZ) on April 8, 2019.

The compensation of Board members frequently creates controversial discussions in society. In this article, Thomas Hutzschenreuter shows that contribution-fair compensation is just not possible for Board members. The reason is that Board members deal with decisions that are (partially) characterized by fundamental uncertainty. This makes it impossible to judge whether a decision is right or wrong in the moment the decision is taken. Therefore the contribution of Board members cannot be compared to contributions of other members of the organization. Hutzschenreuter suggests to seek for compensation systems that are legitimate, accepted by society, transparent and simple.

Prof. Thomas Hutzschenreuter is head of the chair for Strategic and International Management at TUM School of Management. Prof. Hutzschenreuter is a member of various associations for which he also acts as a reviewer. He is Senior Editor of Management and Organization Review and Department Editor of the journal BuR – Business Research.

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