Deutsche Telekom shareholders travelled to the Bonn-based company's Annual General Meeting in good spirits on 9 April, in view of a significant increase in the dividend for 2024 and the outperformance of the share compared to the Dax.

But there was a fly in the ointment, in the view of large institutional investors. Both DWS and Union Investment sharply criticised the remuneration paid to Group CEO Tim Höttges. Henrik Pontzen, Chief Sustainability Officer at Union Investment, accused the Supervisory Board of giving the impression „that CEOs only stay on if a kind of retention bonus is offered and upper limits are arbitrarily extended“. At least that is what the explanatory memorandum suggests. It states that „account is taken“ of the fact that „the current CEO was prepared to extend his mandate prematurely once again“.

Union Investment sarcastically noted that it had assumed that Höttges will remain with Telekom for longer because he has convincing plans for the company and identifies with it. A remuneration system is not made for specific individual cases, but should „establish rules that are universally valid and provide orientation“. Union Investment announced that it would vote against the remuneration system.

The Supervisory Board had raised the maximum remuneration, which is actually limited to 11 million euros per year for the CEO, by 3 million euros. Höttges had expressed his willingness to remain in the post until the end of 2028. The succession solution that had been rumoured for some time, according to which former Head of Germany Srini Gopalan was to become CEO, has thus been taken off the table. Gopalan himself will be 59 years old at the end of 2028. The manager has been sent to the USA.

DWS warned that the Supervisory Board should adjust the maximum remuneration for the CEO downwards again when Höttges' mandate ends. DWS governance expert Hendrik Schmidt said that the consideration of a relative total shareholder return (TSR) in the remuneration of the Management Board should be measured against a demanding peer group.

In spite of these concerns expressed by major shareholders, the resolution on the remuneration system for the management board was approved with 95.85% of valid votes.

In 2024, Telekom shares clearly outperformed the Dax and European rivals with a price increase of 32.8%. The dividend rose by 16.8%. On the occasion of the group's 30th anniversary this year, Höttges promised shareholders that he would work to ensure that the „success story“ continues. „We want today's records to be the norm for tomorrow,“ the manager explained to the assembled shareholders, who represented around 70% of the share capital. With a view to the new US strategy, which now also includes the expansion of fibre optics in addition to mobile communications, the CEO named an expansion target of 12 to 15 million households by 2030.

The business customer subsidiary T-Systems will also be of „particular importance“. „I am glad that we have it,“ said Höttges. The digital sovereignty that Deka had particularly insisted on has been supported by T-Systems for years through the „sovereign cloud“.