Dr. Pendl & Dr. Piswanger International HR Consulting, the Budapest Business Journal and the Joint Venture Association were conducting a joint, anonymous survey in November 2011 about how expatriate managers see the business climate in Hungary. We asked expatriates' assistance by answering 15 simple questions targeting mainly the heads and the top management of companies.
Middle Management Salary Survey in countries of Central and South-Eastern Europe
During the crisis, manager's salaries are a hot topic. In fact we could say that it would be difficult to find a more exciting topic at this time, it raises the question of whether or not they get paid too much for what they do. In the past year, there was a hot debate about whether top managers are paid too high, given the relatively low economic growth. It seems that this topic is present in Austria for several years. Indeed, data from the survey show that the relationship between salaries of CEO's compared with salaries from directors are close-up significantly more than in Slovenia. The relation in Austria is 1,34, while in Slovenia this relation is 2.5.
We also noticed that the ratio between the earnings of the Managing Directors and Middle management in Slovenia decreased. In 2007 we noted that the managing directors earn 3 times more, but today this ratio is only 2.5. We also found that in 2011 the salaries of the Managing Directors decreased by two percentage points less than the salaries increased for middle managers.
Remuneration packages of the CEO's in different companies and even countries is generally bound by following important principles: accountability for achieving the strategic objectives of the company, responsibility for effective financial management and ensuring transparency of operations. In general, the salary of managers comprises of a fixed part, a variable part (which is dependent on the achievement of other objectives or set criteria), short-term rewards tied to achieving annual business goals, long term incentives tied to long-term success of the company and paid in the form of shares or share options, different bonuses and privileges (insurances, company car, parking space, the membership of various associations, specialized trainings, etc..).
Still little is known about rewarding systems of managers in Southeast and Central Europe. Till 2002, salaries of top managers were kept a secret in Slovenia. In 2002 a law was adopted, which prescribes that a public limited liability or shareholding company must annually provide information on the annual total remuneration for management. This information unfortunately only reveals the average income, but not the individual salary of top management. In various countries of CSEE, these systems are differently arranged.
In the international advisory group, Dr. Pendl & Dr. Piswanger, who works in human resources management consulting in the countries of Central and South-Eastern Europe, we have a real data on salaries of managers in the countries of Austria, Bulgaria, Czech Republic, Croatia, Hungary, Romania, Slovakia and Slovenia.
Given the overall of average wages first place in the region occupies Austria, which is probably not unusual; since Austria is seen as one of the top 10 stable economies in the world.
As we can see, the average wages of Managing Directors of mid-sized companies, Slovenia takes second place in the region, behind Austria's Managing Directors. The average salary of CEO's in Austria amounts to € 158.50, € 155.000 in Slovenia, in Romania € 105.000, in Czech Republic € 101.000, € 90.000 in Hungary, € 68.000 in Croatia, in Slovakia € 50.400 and finally in Bulgaria to € 45.000.
