2022: A Historic Year for Corporate Profit-Sharing

The tenth edition of the "Profit-Sharing Barometer" for the SBF120 reveals an exceptional distribution of bonuses, an average increase in bonuses, and growth in dividends. These results point to continued growth in these bonuses in 2023 and 2024.

SBF120 companies awarded profit-sharing bonuses totaling 5.9 billion euros in 2022. Whether in the form of profit-sharing, incentive bonuses, or employer contributions to PEE/PER(E)CO plans, this record amount represents a 20% increase compared to 2021.

According to Mirela Stoeva, director of research at Eres, the companies in the SBF120 index have successfully adapted to the post-COVID-19 economic environment by generating sufficient revenue to redistribute profits on a large scale to their employees.

Although value-sharing arrangements are gaining ground in large companies, significant disparities remain depending on company size.

On average, 52.8% of French employees have access to a profit-sharing plan, but this figure rises to 88.5% in companies with more than 1,000 employees and falls to less than 20% in those with fewer than 50 employees.

Dividend Growth in 2022

Dividends paid to French employee-shareholders in 2022 totaled nearly 980 million euros, also a record amount. SBF120 companies distributed 84.1 billion euros in dividends to their shareholders, marking a 17.4% increase compared to 2021. Sixty-nine percent (69%) of companies increased the amount of dividends distributed in 2022, relating to the 2021 fiscal year, while 12% maintained the same amount.

Average Profit-Sharing Bonus

The average profit-sharing bonus in the SBF120 index amounted to 5,496 euros per employee in 2022, marking a sharp increase since the post-COVID recovery. However, significant disparities persist among companies, with 23% paying bonuses of less than 1,000 euros per employee and 13% paying bonuses of more than 10,000 euros per employee. In 2022, the record bonus reached 29,857 euros per employee. There are also variations by sector, with the luxury sector standing out for its higher bonuses.

Sixty-eight percent (68%) of SBF120 companies incorporate CSR criteria into the conditions for triggering their profit-sharing plans, with priorities such as reducing greenhouse gas emissions, the sustainable use of materials, and energy conservation.

Following the record-breaking year of 2022, 2023 is shaping up to be a pivotal year for profit-sharing. Three main factors are driving this trend: the “Value Sharing” Act, pension reform, and inflation. The Value Sharing Act offers an opportunity to make bonus distributions more accessible to all French employees. Pension reform strengthens the role of companies in building retirement savings, with the Retirement Savings Plan (PER) becoming more widespread alongside profit-sharing bonuses. Increasing these bonuses could also serve as a solution to inflation and the loss of purchasing power among the French public, meeting labor unions’ expectations for an inflation-indexed adjustment.