I=5
- Volkswagen Supervisory Board agreed to tie the management board’s performance bonuses to the company’s absolute net cash flow from 2024, CFO Arno Antlitz announced in a Linkedin post.
- The net cash flow metric will replaces “Operating Profit including China" metric and complements “Return on Sales” and “Achievement of ESG Goals” metrics.
- Plans to alter the management renumeration structure were first announced during the company’s capital markets day.
Assessment
I think it’s a good idea to include cash flow as one of the performance metric, especially since Volkswagen net cash fow hasn’t performed so well this year. Also, the “operating profit” metric is already accounted in “Return on Sales.” It’s also good to see Volkswagen implementing the plans announced at its capital markets day.