New research from Vlerick Business School reveals a notable shift in gender diversity at the executive level, showing a 150% increase in the number of female CEOs in Europe over the past decade. While women still make up only 8% of CEOs across European companies, this figure has grown significantly from just 3.2% in 2014.
Steady Growth in Female Leadership
The study, conducted by Professor Xavier Baeten and senior researcher Marthe Van Hove, tracks CEO remuneration and corporate governance trends within the STOXX Europe 600—an index comprising the 600 largest publicly listed companies across 17 European countries. Their findings highlight a broader trend toward gender diversity in corporate leadership.
In addition to the rise in female CEOs, the number of women on company boards has nearly doubled, increasing from 22% in 2014 to 40% in 2023. This growth indicates that while female representation at the highest level remains limited, boardrooms are gradually becoming more inclusive.
“Although progress is slow, the numbers show a clear positive trend,” said Professor Baeten. “Companies are recognising the value of diversity in leadership, and we expect this momentum to continue.”
CEO Pay Trends: No Significant Increase in Real Terms
The study also examined CEO remuneration over the past 10 years. Despite common perceptions of soaring executive pay, the research found that, when adjusted for inflation, there has been no significant increase in total CEO remuneration since 2014.
- In 2014, the median total CEO remuneration in the STOXX 600 stood at €2,881,581.
- By 2023, this figure rose to €3,809,077 but when adjusted for inflation, the real median compensation was €3,078,744, showing no substantial increase.
By controlling for factors such as company size and financial performance, the research confirmed that compensation levels have remained relatively stable in real terms. “While individual cases may vary, the overall trend suggests that CEO pay has not increased dramatically in the past decade,” noted Professor Baeten.
ESG and Diversity Metrics Gain Importance in Executive Pay
Another key trend identified in the study is the increasing integration of non-financial performance indicators such as environmental, social, and governance (ESG) factors, employee engagement, and diversity metrics into executive compensation.
- In 2014, only 16% of companies in the STOXX 600 used non-financial performance indicators in long-term incentive plans. By 2023, this had risen to 64%.
- The use of environmental KPIs in executive bonus structures has grown significantly, from 5% in 2014 to 43% in 2023.
- The proportion of companies incorporating non-financial indicators in annual bonuses has increased from 71% in 2014 to 90% in 2023.
This shift reflects a growing recognition that executive compensation should align not only with financial performance but also with broader corporate responsibility goals.
“The landscape of executive remuneration is evolving,” added Baeten. Companies are increasingly incorporating sustainability and diversity criteria into their compensation structures, reflecting a more holistic approach to corporate success.
Partnering with Deloitte for Executive Pay Analysis
The research, conducted in partnership with Deloitte, is part of an annual study by the Executive Remuneration Centre at Vlerick Business School. The findings offer valuable insights into the evolving structure of CEO compensation and the ongoing push for gender diversity in leadership.
While female representation at the top remains limited, the steady increase in women CEOs and board members signals a positive shift toward greater gender balance in European corporate leadership.
