The next head of the Allianz supervisory board should not come from the insurance group itself. At the purely virtual general meeting of the largest German insurer, the chairman of the supervisory board, Michael Diekmann, spoke about the payment of supervisory board members and, almost incidentally and without naming names, explained that the current group boss Oliver Bäte will not move to the top of the supervisory board.
“Meanwhile, institutional investors and proxy advisors are increasingly expecting that no former member of the Board of Management of Allianz SE will chair the Supervisory Board,” said Diekmann.
With that, Bäte is out. “In order to be able to recruit suitable external candidates for this position as well, the remuneration must be attractive,” said Diekmann. Proxy advisors help large investors comply with the rules they set themselves for their investments. This also includes appointments to supervisory boards.
Compensation should increase
The annual fixed remuneration for the members of the Supervisory Board is to rise to EUR 150,000 each, up from EUR 125,000 previously. Diekmann justified this with the competition with other companies. “The remuneration for the chairman of the supervisory board is to be tripled, i.e. 450,000 euros, and for the deputy chairmen to 225,000 euros each,” said Diekmann.
These are hefty increases: So far, Diekmann has received 250,000 euros as basic remuneration. There are also attendance fees and payments for membership in committees. His total remuneration from the Allianz Supervisory Board in 2022 therefore amounted to 537,000 euros.
Because Bäte will not become chairman of the supervisory board, he can remain CEO after the 2024 annual general meeting. The current head of the supervisory board, Diekmann, 68, must retire by 2026 at the latest according to Allianz’s age rules. If Bäte had wanted to succeed him, he would have had to resign as CEO at the 2024 Annual General Meeting in order to comply with the prescribed two-year cooling-off period. Allianz can now extend the CEO’s contract, which expires in 2024. As things stand at present, that is likely.
In his report, Bäte also commented on the structured alpha fund fraud scandal in the USA. There, Allianz has to pay more than five billion euros in penalties and damages and is not allowed to sell any funds through its subsidiary Allianz Global Investors for ten years. Bäte emphasized that something like this shouldn’t happen again. “We will raise the implementation of the diverse regulatory rules from a mandatory exercise to a core discipline of our top management,” he promised.