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The remuneration of board members and key executives of listed companies has received considerable attention in the past decade. By contrast, the same issue has yet to be fully addressed in the case of state‑owned enterprises (SOEs). This report seeks to fill the gap by taking stock of the policies and practices underpinning the remuneration of supervisory board members and executive managers of SOEs across 36 OECD member and partner countries.
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The remuneration of boards and executive management presents concrete challenges for the ownership of SOEs, and it straddles the spheres of corporate and public sector governance. While remuneration schemes falling below market levels may hamper the recruitment of qualified candidates, remuneration levels perceived as being too high can cause a public backlash. This issue also bears relevance in the midst of the COVID‑19 crisis, which has increased scrutiny of executive pay packages and may be an opportunity to reconsider executive pay generally to “build back better”.
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This chapter takes stock of policy approaches underpinning the remuneration of ordinary board members, board chairs and board committee members across countries. The chapter explores the extent to which board remuneration practices and levels relate to countries’ ownership arrangements and their SOEs’ corporate characteristics – including their size, commercial and non-commercial orientation, and sector of operation. It also takes stock of transparency and disclosure practices by ownership entities and SOEs.
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This chapter takes stock of policies and practices underpinning the remuneration of executive managers of SOEs across countries. It takes stock of executive remuneration levels and pay packages, and explores the extent to which the state as an owner influences the board of directors’ autonomy to decide on managerial remuneration and incentives. The chapter also presents good transparency and disclosure practices.
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In Bulgaria, Chile, France, Greece, the Netherlands, Peru and Sweden, all SOEs are classified as commercially oriented (i.e. they operate in open market competition, and must be profitable and efficient), regardless of the nature of their objectives. However, in Greece, SOEs which may serve a public policy are funded in part or in whole from the state budget. Information is not available for Australia, Austria, the Slovak Republic and Spain.
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